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CytoDyn Inc.

01/09/2026 | Press release | Distributed by Public on 01/09/2026 07:31

Quarterly Report for Quarter Ending November 30, 2025 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations

Certain information included in this quarterly report on Form 10-Q contains, or incorporates by reference, forward-looking statements that involve risks, uncertainties, and assumptions that are difficult to predict. Words and expressions reflecting optimism, satisfaction, or disappointment with current prospects, as well as words such as "believes," "intends," "estimates," "expects," "projects," "plans," "anticipates," and variations thereof, or the use of future tense, identify forward-looking statements, but their absence does not mean that a statement is not forward-looking.

Our forward-looking statements are not guarantees of performance, and actual results could vary materially from those contained in or expressed by such statements. In evaluating all such statements, we urge you to specifically consider various risks identified elsewhere in this quarterly report including Item 1A of Part II, as well as those set forth in Item 1A. Risk Factors in the 2025 Form 10-K, any of which could cause actual results to differ materially from those indicated by our forward-looking statements.

Our forward-looking statements reflect our current views with respect to future events and are based on currently available financial, economic, scientific, and competitive data and information about current business plans.

Forward-looking statements may include, among others, statements about leronlimab, its ability to have positive health outcomes, the Company's ability to implement a successful operating strategy for the development of leronlimab and thereby create shareholder value, the ability to obtain regulatory approval of the Company's drug products for commercial sales, and the strength of the Company's leadership team. The Company's forward-looking statements are not guarantees of performance, and actual results could vary materially from those contained in or expressed by such statements due to risks and uncertainties, including: (i) the regulatory determinations of leronlimab's safety and effectiveness to treat the disease and conditions for which we are studying the product by the FDA and, potentially, drug regulatory agencies in other countries; (ii) the Company's ability to raise additional capital to fund its operations; (iii) the Company's ability to meet its debt and other payment obligations; (iv) the Company's ability to enter into or maintain partnership or licensing arrangements with third parties; (v) the Company's ability to recruit and retain key employees; (vi) the timely and sufficient development, through internal resources or third-party consultants, of analyses of the data generated from the Company's clinical trials required by the FDA or other regulatory agencies in connection with applications for approval of the Company's drug product; (vii) the Company's ability to achieve approval of a marketable product; (viii) the design, implementation, and conduct of clinical trials; (ix) the results of any such clinical trials, including the possibility of unfavorable clinical trial results; (x) the market for, and marketability of, any product that is approved; (xi) the existence or development of vaccines, drugs, or other treatments that are viewed by medical professionals or patients as superior to the Company's products; (xii) regulatory initiatives, compliance with governmental regulations, and the regulatory approval process; (xiii) legal proceedings, investigations, or inquiries affecting the Company or its products, including the finalization of an agreement in principle to settle the class action litigation filed against the Company in the state of Washington; (xiv) stockholder actions or proposals with regard to the Company, its management, or its Board of Directors; (xv) general economic and business conditions; (xvi) changes in domestic and foreign political and social conditions; and (xvii) various other matters, many of which are beyond the Company's control.

We intend that all forward-looking statements made in this quarterly report will be subject to the safe harbor protection of the federal securities laws pursuant to Section 27A of the Securities Act and Section 21E of the Exchange Act, to the extent applicable. Except as required by law, we do not undertake any responsibility to update these forward-looking statements to address events or circumstances that occur after the date of this quarterly report. Additionally, we do not undertake any responsibility to update you on the occurrence of any unanticipated events that may cause actual results to differ from those expressed or implied by these forward-looking statements.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our 2025 Form 10-K, and the other sections of this Form 10-Q, including our consolidated financial statements and related notes set forth in Part I, Item 1. This discussion and analysis contains forward-looking statements, including information about possible or assumed results of our financial condition, operations, plans, objectives, and performance that involve risks, uncertainties, and assumptions. The actual results may differ materially from those anticipated and set forth in such forward-looking statements.

Overview

The Company is a clinical stage biotechnology company focused on the clinical development and potential commercialization of its product candidate, leronlimab, which is being studied for its potential in solid-tumor oncology.

Our current business strategy is to continue to pursue the clinical development of leronlimab, which may include the following:

Continue the Phase II trial of leronlimab in patients with relapsed/refractory micro-satellite stable colorectal cancer;

Conduct additional studies exploring leronlimab and its therapeutic potential in other solid-tumor oncology indications, including but not limited to metastatic Triple-Negative Breast Cancer; and

Continue our work researching and developing a new or modified long-acting version of leronlimab.

We may need significant additional funding to execute the above business strategy in full, which may include conducting a variety of additional pre-clinical studies and clinical trials, in furtherance of our efforts to obtain FDA approval to commercialize leronlimab. In addition to traditional fundraising, the Company will pursue non-dilutive financing opportunities, such as license agreements and co-development or strategic partnerships, to help implement its strategy.

Corporate Developments

On November 21, 2025, at the Company's annual meeting, our stockholders voted in favor of an amendment to the Company's Certificate of Incorporation to provide for an increase in the total number of shares of common stock authorized for issuance from 1,750,000,000 shares to 2,250,000,000 shares. Additionally, stockholders voted in favor of the reelection of existing directors, on an advisory basis in favor of CBIZ CPAs P.C. as the Company's independent registered public accounting firm for the fiscal year ending May 31, 2026, on an advisory basis in favor of named executive officer compensation, and on an advisory basis in favor of holding an advisory vote on executive compensation every year.

On November 23, 2025, the Company reached an agreement in principle to settle the securities class action pending in the United States District Court for the Western District of Washington (the "Court"), Courter et al. v. CytoDyn Inc. et al, Case No. C21-5190 BHS (the "Securities Class Action"). The agreement in principle provides for a payment by the Company to the class of $500,000 in cash and the issuance of 49 million shares of common stock of the Company in exchange for the dismissal and release of all claims against all defendants in the Securities Class Action. The agreement is subject to final documentation, court approval, and other conditions. There can be no assurances as to the ultimate outcome of the Securities Class Action, including that the final settlement agreement will be executed, that the settlement agreement, if executed, will include the terms and conditions currently anticipated by the Company, that such agreement will be approved by the Court, or that any revised settlement terms, if applicable, will be finalized by the parties and approved by the Court. A final, non-appealable closure of the litigation could take several months. The agreement in principle does not constitute an admission by the Company of any fault or liability and the Company does not admit fault or liability. If the settlement cannot be finalized by the parties or is not approved by the Court, the Company will defend the Securities Class Action vigorously and believes there are meritorious defenses and legal standards that must be met for, among other things, success by the plaintiffs on the merits. If the parties are unable to finalize the settlement, the Securities Class Action could have a material adverse effect on the Company's financial condition, results of operations, and cash flows.

Results of Operations

Fluctuations in operating results

The Company's operating results may fluctuate significantly depending on the outcomes, number and timing of pre-clinical and clinical studies, patient enrollment and/or completion rates in the studies, and their related effect on research and development expenses, regulatory and compliance activities, activities related to seeking FDA approval of our drug product, general and administrative expenses, professional fees, and legal and regulatory proceedings and related consequences. We require a significant amount of capital to continue to operate; therefore, we regularly conduct financing offerings to raise capital, which may result in various forms of non-cash interest expense or other expenses. Additionally, we periodically seek to negotiate settlement of debt payment obligations in exchange for equity securities of the Company and enter into warrant exchanges or modifications that may result in non-cash charges. Our ability to continue to fund operations will depend on our ability to raise additional funds. See the Liquidity and Capital Resources and Going Concern sections in this Item 2 of Part I, Item 1A of Part II of this report, and Item 1A. Risk Factors in our 2025 Form 10-K.

The results of operations were as follows for the periods presented:


	Three months ended November 30,				Change					Six months ended November 30,				Change
(in thousands, except for per share data)	2025		2024		$			%		2025		2024		$		%
Operating expenses:
General and administrative	$	1,799	$	2,298	$	(499)		(22)	%	$	3,512	$	3,907	$	(395)	(10)	%
Research and development		3,302		1,409		1,893		134			6,534		(22,637)		29,171	129
Legal settlement loss		16,587		-		16,587		100			16,587		-		16,587	100
Total operating expenses		21,688		3,707		17,981		485			26,633		(18,730)		45,363	242
Operating (loss) gain		(21,688)		(3,707)		(17,981)		(485)			(26,633)		18,730		(45,363)	(242)
Interest and other income (expense):
Interest income		57		142		(85)		(60)			151		268		(117)	(44)
Interest on convertible notes		(644)		(1,161)		517		45			(1,320)		(2,326)		1,006	43
Amortization of discount on convertible notes		-		(113)		113		100			-		(238)		238	100
Standby equity purchase agreement commitment fee		(325)		-		(325)		(100)			(325)		-		(325)	(100)
Loss on induced conversion		-		-		-		-			-		(1,180)		1,180	100
Finance charges		(7)		(9)		2		22			(20)		(23)		3	13
Gain on restructuring of payables		-		80		(80)		(100)			-		80		(80)	(100)
Loss on derivatives		-		-		-		-			-		(852)		852	100
Total interest and other expenses		(919)		(1,061)		142		13			(1,514)		(4,271)		2,757	65
(Loss) gain before income taxes		(22,607)		(4,768)		(17,839)		(374)			(28,147)		14,459		(42,606)	(295)
Income tax benefit		-		-		-		-			-		-		-	-
Net (loss) income	$	(22,607)	$	(4,768)	$	(17,839)		(374)	%	$	(28,147)	$	14,459	$	(42,606)	(295)	%
(Loss) income per share:
Basic	$	(0.02)	$	(0.00)	$	(0.02)		(100)	%	$	(0.02)	$	0.01	$	(0.03)	(300)	%
Diluted	$	(0.02)	$	(0.00)	$	(0.02)		(100)	%	$	(0.02)	$	0.01	$	(0.03)	(300)	%

Weighted average common shares used in calculation of (loss) income per share:
Basic		1,261,016		1,221,405		39,611		3			1,256,761		1,177,988		78,773	7	%
Diluted		1,261,016		1,221,405		39,611		3			1,256,761		1,204,193		52,568	4	%

General and administrative ("G&A") expenses

G&A expenses consisted of the following:


	Three months ended November 30,				Change				Six months ended November 30,				Change
(in thousands)	2025		2024		$		%		2025		2024		$		%
Salaries, benefits, and other compensation	$	492	$	335	$	157	47	%	$	987	$	760	$	227	30	%
Stock-based compensation		92		320		(228)	(71)			183		456		(273)	(60)
Legal fees		291		763		(472)	(62)			667		1,139		(472)	(41)
Insurance		263		320		(57)	(18)			540		643		(103)	(16)
Other		661		560		101	18			1,135		909		226	25
Total general and administrative	$	1,799	$	2,298	$	(499)	(22)	%	$	3,512	$	3,907	$	(395)	(10)	%

The decrease in G&A expenses for the three- and six-month periods ended November 30, 2025, compared to the same periods in the prior year, was primarily due to legal fees. The decrease in legal fees is primarily attributable to decreased legal activity compared to the prior year.

Research and development ("R&D") expenses

R&D expenses consisted of the following:


	Three months ended November 30,				Change				Six months ended November 30,				Change
(in thousands)	2025		2024		$		%		2025		2024		$		%
Clinical	$	2,536	$	823	$	1,713	208	%	$	5,015	$	1,560	$	3,455	221	%
Non-clinical		221		343		(122)	(36)			421		329		92	28
CMC		408		390		18	5			823		360		463	129
License and patent fees		137		(147)		284	(193)			275		99		176	178
Return of clinical expenses		-		-		-	-			-		(24,985)		24,985	(100)
Total research and development	$	3,302	$	1,409	$	1,893	134	%	$	6,534	$	(22,637)	$	29,171	(129)	%

The increases in R&D expenses in the three- and six-month periods ended November 30, 2025, compared to the same periods in the prior year, were due to higher clinical expenses related to the Phase II trial of leronlimab in patients with relapsed/refractory micro-satellite stable colorectal cancer in the fiscal 2026 periods. Additionally with regard to the six-month period ended November 30, 2025, the primary factor contributing to the increase in R&D expenses was a return of clinical expenses related to the settlement of the Company's litigation with Amarex in the six-month period ended November 30, 2024.

The future trend of our R&D expenses is dependent on the costs of any future clinical trials and our decisions regarding which indications on which to focus our future efforts toward the development and study of leronlimab, which may include pre-clinical and clinical studies for oncology and inflammation, as well as efforts to develop a long-acting new or modified therapeutic, and the timing and outcomes of such efforts.

Interest and other income (expense)

Interest and other income (expense) consisted of the following:


	Three months ended November 30,				Change				Six months ended November 30,				Change
(in thousands)	2025		2024		$		%		2025		2024		$		%
Interest income	$	57	$	142	$	(85)	(60)	%	$	151		268	$	(117)	(44)	%
Interest on convertible notes		(644)		(1,161)		517	45			(1,320)	$	(2,326)		1,006	(43)
Amortization of discount on convertible notes		-		(113)		113	100			-		(238)		238	(100)
Standby equity purchase agreement commitment fee		(325)		-		(325)	(100)			(325)		-		(325)	100
Loss on induced conversion		-		-		-	-			-		(1,180)		1,180	(100)
Finance charges		(7)		(9)		2	22			(20)		(23)		3	(13)
Gain on restructuring of payables		-		80		(80)	(100)			-		80		(80)	(100)
Loss on derivatives		-		-		-	-			-		(852)		852	(100)
Total interest and other expenses	$	(919)	$	(1,061)	$	142	(13)	%	$	(1,514)	$	(4,271)	$	2,757	(65)	%

The decrease in interest and other expenses for the three-month period ended November 30, 2025, compared with the same period in the prior year, was primarily due to a lower interest rate in the current period compared to the prior period. The decrease was partially offset by the commitment fee for a standby equity purchase agreement. See Note 5, Equity-Standby Equity Purchase Agreement, included in Part I, Item 1 of this Form 10-Q for additional information.

The decrease in interest and other expenses for the six-month period ended November 30, 2025, compared with the same period in the prior year, was primarily due to the decreases in loss on induced conversion, interest on convertible notes payable, and loss on derivatives. The decrease in loss on induced conversion is due to the note payments in the current fiscal year being exchanged with an equal value of shares of common stock. The decrease in interest on convertible notes payable is due to a lower interest rate compared to the prior period. The decrease in loss on derivatives is due to no derivative activity in the fiscal 2026 period.

Liquidity and Capital Resources

As of November 30, 2025, we had a total of approximately $5.0 million in cash and cash equivalents and approximately $85.1 million in short-term liabilities. We expect to continue to incur operating losses and require a significant amount of capital in the future as we continue to seek approval to commercialize leronlimab. There can be no assurance that future funding will be available to us when needed on terms that are acceptable to us, or at all. We sell securities and incur debt when the terms of such arrangements are deemed acceptable to both parties under then current circumstances and as necessary to fund our current and projected cash needs.As of November 30, 2025, we had approximately 490.1 million shares of common stock available for issuance in new financing transactions.

Since inception, the Company has financed its activities principally from the public and private sale of equity securities as well as with proceeds from issuances of convertible notes. The Company intends to finance its future operating activities and its working capital needs largely from the sale of equity and debt securities. The sale of equity and convertible debt securities to raise additional capital is likely to result in dilution to stockholders and those securities may have rights senior to those of common shares. If the Company raises funds through the issuance of additional preferred stock, convertible debt securities or other debt or equity financing, the related transaction documents may contain covenants restricting its operations.

During the 2021 fiscal year, the Company entered into long-term convertible notes that are secured by all of our assets (excluding our intellectual property), and include certain restrictive provisions, including limitations on incurring additional indebtedness and future dilutive issuances of securities, any of which could impair our ability to raise additional capital on acceptable terms.

Future third-party funding arrangements may also require the Company to relinquish valuable rights. Additional capital, if available, may not be available on reasonable or non-dilutive terms.

Cash and cash equivalents

The Company's cash and cash equivalents position of approximately $5.0 million as of November 30, 2025, decreased by approximately $6.9 million when compared to the balance of $11.9 million as of May 31, 2025. This decrease was primarily the result of approximately $6.8 million cash used in operating activities. Refer to Item 1, Note 2, Summary of Significant Accounting Policies - Going Concern, and the Going Concern discussion below for information regarding concerns about the Company's ability to continue to fund its operations and satisfy its payment obligations and commitments. A summary of cash flows and changes between the periods presented is as follows:


	Six months ended November 30,						Change
(in thousands)	2025			2024			$
Net cash (used in) provided by:
Net cash (used in) provided by operating activities	$	(6,800)		$	1,854		$	(8,654)
Net cash (used in) provided by financing activities	$	(121)		$	9,667		$	(9,788)

Cash used in operating activities

Net cash used in operating activities totaled approximately $6.8 million during the six months ended November 30, 2025, representing an increase of approximately $8.7 million compared to the six months ended November 30, 2024. The increase in the net amount of cash used in operating activities was due primarily to a one-time legal settlement of approximately $10.0 million in the prior period.

Cash used in financing activities

Net cash used in financing activities totaled approximately $0.1 million during the six months ended November 30, 2025, a decrease of approximately $9.8 million compared to the six months ended November 30, 2024. The decrease in net cash provided was primarily the result of no significant fundraising during the fiscal 2026 period.

Convertible debt

April 2, 2021 Convertible Note

On April 2, 2021, we issued a convertible note with a principal amount of $28.5 million resulting in net cash proceeds of $25.0 million, after $3.4 million of debt discount and $0.1 million of offering costs. The note accrues interest daily at a rate of 6% per annum, has a stated conversion price of $10.00 per share, and matures in April 2026. As of November 30, 2025, the outstanding balance of the April 2, 2021 Note, including accrued interest, was approximately $8.5 million.

April 23, 2021 Convertible Note

On April 23, 2021, we issued a convertible note with a principal amount of $28.5 million resulting in net cash proceeds of $25.0 million, after $3.4 million of debt discount and $0.1 million of offering costs. The note accrues interest daily at a rate of 6% per annum, has a stated conversion price of $10.00 per share, and matures in April 2026. As of November 30, 2025, the outstanding balance of the April 23, 2021 Note, including accrued interest, was approximately $33.7 million.

Common stock

We have 2,250.0 million authorized shares of common stock. The table below summarizes intended uses of common stock.


	As of
(in millions)	November 30, 2025
Issuable upon:
Warrant exercises	212.4
Convertible preferred stock and undeclared dividends conversion	41.5
Outstanding stock option exercises or vesting of outstanding PSUs	42.0
Reserved for issuance pursuant to future stock-based awards under equity incentive plan	18.4
Reserved for issuance under Standby Equity Purchase Agreement	118.7
Reserved for issuance pursuant to legal settlement, subject to court approval	49.0
Reserved and issuable upon conversion of outstanding convertible notes	12.0
Total shares reserved for future uses	494.0
Common stock outstanding	1,265.9

As of November 30, 2025, we had approximately 490.1 million unreserved authorized shares of common stock available for issuance. Our ability to continue to fund our operations depends on our ability to raise capital. The funding necessary for our operations may not be available on acceptable terms, or at all. If we deplete our cash reserves, we may have to discontinue our operations and liquidate our assets. In extreme cases, we could be forced to file for bankruptcy protection.

Off-Balance Sheet Arrangements

As of November 30, 2025, we did not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material effect on our current or future financial condition, results of operations, liquidity, capital expenditures or capital resources.

Contractual Obligations

Refer to Note 3, Accrued Liabilities and Compensation, Note 4, Convertible Instruments and Accrued Interest, and Note 10, Commitments and Contingencies included in Part I, Item 1 of this Form 10-Q, and Notes 4 and 9 in Part II, Item 8 in the 2025 Form 10-K.

Legal Proceedings

The Company is a party to various legal proceedings described in Part I, Item 1, Note 10, Commitments and Contingencies - Legal Proceedings of this Form 10-Q. The Company recognizes accruals for such proceedings to the extent a loss is determined to be both probable and reasonably estimable. The best estimate of a loss within a possible range is accrued; however, if no estimate in the range is more probable than another, then the minimum amount in the range is accrued. If it is determined that a material loss is not probable but reasonably possible and the loss or range of loss can be estimated, the possible loss is disclosed.

It generally is not possible to predict the outcome of these proceedings, including the defense and other litigation-related costs and expenses that may be incurred by the Company, as the outcomes of legal proceedings are inherently uncertain, and the outcomes could differ significantly from recognized accruals. Therefore, it is possible that the ultimate outcome of any proceeding, if in excess of a recognized accrual, if any, could be material to the Company's consolidated financial statements. As of November 30, 2025, the Company had not recorded any accruals related to the outcomes of the legal matters discussed in this Form 10-Q, other than approximately $16.6 million in connection with an agreement in principle to settle the Securities Class Action, as discussed above under "Corporate Developments.".

Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As presented in the accompanying consolidated financial statements, the Company had losses for all periods presented, except for the six months ended November 30, 2024. Net income of $14.5 million in the six months ended November 30, 2024, resulted from the recovery of approximately $25.0 million in clinical expenses due to the settlement of the Company's litigation with Amarex, which is a non-recurring event. The Company had an accumulated deficit of approximately $915.9 million as of November 30, 2025. These factors, among several others, raise substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company's continuance as a going concern is dependent upon its ability to obtain additional operating capital, complete the development of its product candidate, leronlimab, obtain approval to commercialize leronlimab from regulatory agencies, continue to outsource manufacturing of leronlimab, and ultimately achieve revenues and attain profitability. The Company plans to continue to engage in research and development activities related to leronlimab and a new or modified longer-acting therapeutic and expects to incur significant research and development expenses in the future, primarily related to its regulatory compliance, including performing additional clinical trials and seeking regulatory approval of its product candidate for commercialization. These research and development activities are subject to significant risks and uncertainties. The Company intends to finance its future development activities and its working capital needs primarily from the sale of equity and debt securities, combined with additional funding from other sources. However, there can be no assurance that the Company will be successful in these endeavors. See also Liquidity and Capital Resources above.

New Accounting Pronouncements

Refer to Part I, Item 1, Note 2, Summary of Significant Accounting Policies - Recent Accounting Pronouncements in this Form 10-Q for the discussion.

Critical Accounting Estimates

This discussion and analysis of the Company's financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of our financial statements and related disclosures requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of expenses during the reporting periods. The Company's critical accounting estimates are described under the heading Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates in our 2025 Form 10-K.

CytoDyn Inc. published this content on January 09, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on January 09, 2026 at 13:31 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]

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CytoDyn Inc.

Quarterly Report for Quarter Ending November 30, 2025 (Form 10-Q)