10-Q: Radnostix Inc. Q1 2026 Results Show Revenue Decline Amid Recalls

Radnostix Inc. reported a significant decrease in revenue for the first quarter of 2026, primarily due to voluntary product recalls and operational shutdowns, leading to a substantial net loss.

Summary

• Radnostix Inc. reported a net loss of $1,348,086 for the first quarter ended March 31, 2026, a significant increase from the $112,694 net loss in the same period of 2025.
• Total sales decreased by 27% to $2,378,924 in Q1 2026 from $3,238,900 in Q1 2025.
• The decrease in sales was attributed to voluntary recalls of Generic Sodium Iodide I-131 and Dibasic Sodium Phosphate Capsules, an operational shutdown for hot cell rehabilitation in the Cobalt Products segment, and decreased sales in Calibration & Reference Products.
• Operating expenses increased by 17% to $2,460,980 in Q1 2026 from $2,097,053 in Q1 2025, driven by higher professional expenses, increased salaries and contract labor (including stock-based compensation with an out-of-period adjustment), and R&D expenses.
• The company terminated an asset purchase agreement for its Fluorine Products segment and Planned Uranium De-Conversion Facility with American Fuel Resources (AFR) on March 11, 2026, after AFR failed to make the required payment.
• The company expects cash from operations, equity financing, and its current cash balance to be sufficient for the next twelve months, but acknowledges uncertainty regarding future capital availability.
• The Series C Preferred Stock maturity date was extended to February 28, 2028.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative filing due to significant revenue declines, increased net loss, product recalls, and ongoing regulatory scrutiny, despite some positive developments in specific segments and asset re-evaluation.

Positives

• The Medical Device Products segment saw a 69% increase in sales, reaching $89,113 in Q1 2026 from $52,630 in Q1 2025.
• The rehabilitation of Cobalt-60 process hot cells is expected to extend their useful life by 15 to 20 years and save approximately $150,000 annually in radiological waste costs.
• The company continues to provide Generic Sodium Iodide I-131, which was not impacted by the capsule recall.
• The company is working on establishing new suppliers for Gadolinium-153 and expects supply to be restored by the end of 2026.
• The company believes it has regained control of valuable assets after terminating the DUF6 Asset Sale with AFR.

Negatives

• Net loss increased significantly to $1,348,086 in Q1 2026 from $112,694 in Q1 2025.
• Total sales decreased by 27% in Q1 2026 compared to Q1 2025.
• Two voluntary product recalls (Generic Sodium Iodide I-131 and Dibasic Sodium Phosphate Capsules) in Q1 2026 resulted in lost revenue and customer credits.
• The Cobalt Products segment experienced an 87% decrease in sales due to an operational shutdown for hot cell rehabilitation.
• The Calibration & Reference Products segment saw a 33% decrease in sales, partly due to a global shortage of Gadolinium-153.
• Operating expenses increased by 17% in Q1 2026.
• An FDA inspection in April 2025 resulted in an Official Action Indicated (OAI), with corrective actions ongoing.
• The company has a history of substantial losses since inception.

Risks

• Reliance on a just-in-time supply chain for radioisotopes, where any disruption can lead to significant product loss and revenue impact.
• Interruption in the supply of critical isotopes like cobalt-57, cobalt-60, or iodine-131 could result in lost sales.
• Potential for loss of revenue if new distributors cannot be procured for territorial or regional markets.
• Adverse effects on the price and availability of raw material radioisotopes from overseas suppliers due to currency fluctuations, tariffs, sanctions, geopolitics, or other restrictions.
• Inability to restore supply of Gadolinium-153 by the end of 2026 could lead to continued revenue loss in the Calibration & Reference Products segment.
• Reliance on research reactors for I-131 supply, which have a higher frequency of downtime compared to traditional power reactors.
• Risks associated with the DOE supply chain for cobalt-60, including access to feed stock and potential disruptions from the Advanced Test Reactor (ATR) maintenance or focus on naval operations.
• Potential for FDA enforcement actions, including warning letters, penalties, product recalls, or manufacturing holds, due to non-compliance with regulations.
• Risk of NRC license enforcement actions, including civil penalties or restrictions on operations, for violations of NRC regulations.
• The company's ability to secure future financing on acceptable terms is not assured.

Future Outlook

The company expects cash from operations, equity financing, and its current cash balance to be sufficient to fund operations for the next twelve months. Future liquidity and capital funding requirements will depend on various factors including commercial relationships, technological developments, market factors, available credit, and management of redeemable convertible preferred stock. There is no assurance that additional capital and financing will be available on acceptable terms or at all.

Management Comments

• Management believes it was in the best interest of shareholders to regain control of the DUF6 Plant and related assets as they believe they have appreciated in value.
• Management is evaluating all possible options for the DUF6 Plant and related assets, including developing them into an operating entity or exploring amendments to the NRC license for additional uranium-related activities.
• Management believes the company is well-positioned to serve the growing radioisotope and radiopharmaceutical market segments.
• Management believes the company's unique combination of licensing status, GMP compliance, FDA licensed facility, and experienced personnel provides a competitive advantage in the theranostics space.
• Management believes the rehabilitation of the Cobalt-60 process hot cells has extended their useful life and will result in significant annual cost savings.
• Management believes the impact from the Dibasic Sodium Phosphate Capsules recall will not extend beyond the second quarter.

Industry Context

StockSavvy.ai notes that Radnostix Inc.'s Q1 2026 performance reflects challenges common in the specialized radioisotope and radiopharmaceutical sector, including supply chain vulnerabilities and regulatory hurdles. The company's focus on Theranostics Products aligns with a growing market, but product recalls and operational issues have significantly impacted short-term results. The termination of the DUF6 Asset Sale and subsequent re-evaluation of those assets indicate a strategic shift in response to market dynamics and potential value appreciation.

Comparison to Industry Standards

• The Theranostics market is projected to grow from $4.3 billion in 2024 to $12.7 billion by 2029, a 24% CAGR, according to BCC Research. Radnostix's Theranostics Products segment, while facing short-term setbacks, operates within this high-growth market.
• The company's FDA-approved generic sodium iodide I-131 drug product is noted as the only generic product of its type manufactured in the U.S., offering a domestic alternative to a single foreign commercial manufacturer.
• The Calibration & Reference Products segment serves a market with over 29,000 SPECT and/or PET imaging cameras globally, which require regular calibration sources. Radnostix competes with a few small regional suppliers internationally and one major global producer.
• The company's reliance on the Advanced Test Reactor (ATR) at Idaho National Lab for Cobalt-60 supply is a critical dependency, as ATR's primary mission is to service the U.S. Navy's nuclear fleet, posing a risk of supply disruption.

Legal Proceedings

• A discussion of legal matters is found in Note 7, Commitments and Contingencies, in the accompanying notes to the unaudited condensed consolidated financial statements.

Related Party Transactions

• The company has outstanding promissory notes with its CEO, Chairman, former Chairman, and major shareholders, with terms including interest and potential settlement in common stock.
• The 2013 Promissory Note was with the then Chairman of the Board and one of our major shareholders.
• The 2018 Promissory Note was with its then Chief Executive Officer and Chairman of the Board.
• The 2019 Promissory Note was with its chief executive officer, Chairman, former Chairman, and one of our major shareholders.
• The company entered a promissory note with AMICI, Inc. for the purchase of medical devices and related assets.

Stakeholder Impact

• Shareholders: Increased net loss and revenue decline may negatively impact share value. The termination of the DUF6 Asset Sale and re-evaluation of those assets could present future opportunities or risks.
• Customers: Product recalls have led to lost sales and customer credits. Delays in Gadolinium-153 supply may impact customers relying on Calibration & Reference Products. Customers requiring capsules with their orders are currently losing approximately $65,000 per week in sales.
• Employees: Increased stock-based compensation expense is noted. The company's financial performance could impact job security.
• Suppliers: The company's reliance on specific suppliers for critical isotopes (e.g., Cobalt-60 from DOE, Gadolinium-153) poses a risk to operations if supply is interrupted.
• Creditors: The company has significant outstanding debt, including promissory notes with related parties, and its ability to fund operations for the next twelve months relies on cash from operations, financing, and its current cash balance.

Next Steps

• Continue to focus on core business segments: Theranostics Products, Cobalt Products, and Calibration & Reference Products.
• Focus on starting up the Medical Device segment and investing in the development of an EasyFill Automated Iodine Capsule System.
• Evaluate all possible options for the DUF6 Plant and related assets.
• Work on establishing new suppliers for Gadolinium-153 and restoring supply by the end of 2026.
• Restore Dibasic Sodium Phosphate Capsule inventory in Q2 2026.
• Implement and finalize corrective actions for the FDA OAI within Q2 2026 and request a reinspection.
• Commercialize RadVent products (Swirler and Tru-Fit Mouthpiece) in Q3 2026.
• Roll out the EasyFill Automated Capsule System in Q3 2026 and achieve commercial ramp-up in Q2 2027.
• Continue to develop additional third-party medical devices and accessories.
• Explore potential to amend the current NRC approved license for the DUF6 facility to include additional uranium-related activities.

Key Dates

Recommendation

The company is facing significant headwinds with declining revenues, increased losses, and product recalls. While there are some positive developments in specific segments and strategic re-evaluations of assets, the overall financial performance and ongoing regulatory issues (FDA OAI) warrant caution. The company's ability to secure future financing and resolve supply chain issues are critical. Given the current challenges and uncertainties, a 'hold' recommendation is appropriate, pending stabilization of revenues and resolution of regulatory matters.

Keywords

Radnostix Inc., Form 10-Q, Quarterly Report, Radioisotopes, Radiopharmaceuticals, Theranostics, Cobalt Products, Calibration Standards, Medical Devices, Fluorine Products, Net Loss, Revenue Decline, Product Recalls, FDA, NRC, SEC Filing