10-Q: My Size Reports Q3 Loss Amid Acquisitions, Going Concern Doubt

My Size, Inc. reported a net loss of $1.335 million for Q3 2025, alongside strategic acquisitions of ShoeSizeMe and New Percentil, while facing substantial doubt about its ability to continue as a going concern.

Summary

• Net loss for the nine months ended September 30, 2025, was $2.845 million, an improvement from $3.280 million in the prior year.
• Net loss for the three months ended September 30, 2025, was $1.335 million, an increase from $1.300 million in the prior year.
• Revenues for the nine months ended September 30, 2025, decreased to $6.057 million from $6.802 million in the prior year, primarily due to a decrease in Orgad sales.
• Revenues for the three months ended September 30, 2025, increased to $2.572 million from $1.839 million in the prior year, mainly due to the inclusion of New Percentil.
• Acquired ShoeSizeMe AG, an AI-powered footwear sizing SaaS company, on September 8, 2025, for $150,000 cash and 241,093 common shares (fair value $338,000).
• Acquired the Percentil resale platform business unit on May 9, 2025, for approximately $679,000 (cash payment of $45,000 and assumed liabilities).
• Recorded a $144,000 goodwill impairment charge for the Fashion and equipment e-commerce platform segment in Q3 2025.
• Raised $2.846 million net from an At The Market (ATM) offering of 1,557,727 shares as of September 30, 2025.
• Cash and cash equivalents decreased to $4.493 million as of September 30, 2025, from $4.880 million at December 31, 2024.
• Substantial doubt exists about the company's ability to continue as a going concern for more than 12 months.

Sentiment

Score: 3

Explanation: The company faces significant financial challenges, including ongoing losses, negative cash flow from operations, and substantial doubt about its ability to continue as a going concern. While strategic acquisitions and a recent capital raise provide some positive momentum and Q3 revenue growth, the overall financial health remains precarious, and the goodwill impairment highlights underlying issues in a segment.

Positives

• Net loss for the nine months ended September 30, 2025, decreased to $2.845 million from $3.280 million in the prior year.
• Operating loss for the nine months ended September 30, 2025, decreased to $3.002 million from $3.254 million in the prior year.
• Revenues for the three months ended September 30, 2025, increased to $2.572 million from $1.839 million in the prior year, driven by New Percentil.
• Financial income (expenses), net, improved significantly, moving from an expense of $26,000 in the nine months ended September 30, 2024, to an income of $157,000 in the same period of 2025.
• Strategic acquisitions of ShoeSizeMe and New Percentil expand the company's offerings in AI-powered sizing solutions and the resale apparel market.
• Successful capital raise of $2.846 million net through an At The Market offering.
• Transition to Fulfillment by Amazon for Orgad's inventory reduced cost of revenues for the nine-month period.

Negatives

• Substantial doubt about the company's ability to continue as a going concern for more than 12 months due to projected losses and negative cash flows.
• Net loss for the three months ended September 30, 2025, increased to $1.335 million from $1.300 million in the prior year.
• Operating loss for the three months ended September 30, 2025, increased to $1.356 million from $1.306 million in the prior year.
• Revenues for the nine months ended September 30, 2025, decreased to $6.057 million from $6.802 million in the prior year, primarily due to a decrease in Orgad sales.
• Cash and cash equivalents decreased to $4.493 million as of September 30, 2025, from $4.880 million at December 31, 2024.
• Net cash used in operating activities increased to $2.806 million for the nine months ended September 30, 2025, from $2.523 million in the prior year.
• Recorded a $144,000 goodwill impairment charge for the Fashion and equipment e-commerce platform segment.
• Significant dilution for existing shareholders due to the issuance of 1,557,727 shares through the ATM offering and 241,093 shares for the ShoeSizeMe acquisition.
• Accumulated deficit increased to $66.721 million as of September 30, 2025.

Risks

• History of losses and need for additional capital to fund operations, with no assurance of obtaining it on acceptable terms or at all.
• Substantial doubt about the ability to continue as a going concern.
• New and unproven nature of the measurement technology markets.
• Ability to achieve customer adoption of products.
• Ability to realize the benefits of acquisitions of Orgad, Naiz, New Percentil, and ShoeSizeMe.
• Dependence on assets purchased from a related party.
• Ability to enhance brand and increase market awareness.
• Ability to introduce new products and continually enhance product offerings.
• Success of strategic relationships with third parties.
• Information technology system failures or breaches of network security.
• Competition from competitors.
• Reliance on key members of the management team.
• Current or future litigation, including the Shimon Shukron lawsuit.
• Current or future unfavorable economic and market conditions and adverse developments with respect to financial institutions and associated liquidity risk.
• Changes in tariffs, trade barriers, price and exchange controls, and other regulatory requirements and the impact of such policies on the company, its customers, suppliers, and the global economic environment.
• Impact of the political and security situation in Israel on the company's business, operations, and ability to raise capital, despite current immaterial effect.
• Potential for renewed or expanded military conflicts in the Middle East.
• Risk of economic boycotts against Israel and Israeli companies.
• Political instability within Israel affecting the economy and business.
• Commercial insurance does not cover losses from events associated with the security situation in the Middle East, and government coverage may not be maintained.

Future Outlook

The company expects to continue generating losses and negative cash flows from operations for the foreseeable future. Management believes existing cash will not be sufficient to fund operations for more than 12 months, leading to substantial doubt about its ability to continue as a going concern. Plans include continued commercialization of products, acquisition of technology, intellectual property or businesses, and securing sufficient financing through equity sales, debt, or strategic partnerships. The company is actively seeking additional technology and commercial opportunities to increase cash flow.

Management Comments

• "Management is of the opinion that there is an uncertainty that its existing cash will be sufficient to fund operations for a period of more than 12 months."
• "Managements plans include the continued commercialization of the Companys products and acquisition of technology, intellectual property or businesses and securing sufficient financing through the sale of additional equity securities, debt or capital inflows from strategic partnerships."
• "Management is actively looking for additional technology and commercial opportunities that will increase the companys cashflow."
• "We are positioning ourselves as a consolidator of sizing solutions and new digital experience due to new developments for the fashion industry needs."

Industry Context

The company is actively expanding its footprint in the e-commerce and fashion technology sectors through strategic acquisitions like ShoeSizeMe (AI-powered footwear sizing) and New Percentil (resale apparel platform). This aligns with broader industry trends towards personalized shopping experiences, sustainability (resale market), and the integration of AI/SaaS solutions to address common e-commerce challenges like sizing and returns. The company aims to be a consolidator in the sizing solutions space, indicating a belief in market fragmentation and potential for synergy.

Corporate Governance

Legal Proceedings

• The company was served with a legal complaint in July 2024 by Shimon Shukron for NIS 1,895,345 (approximately $510,000) due to alleged fire damage at Orgad's warehouse in January 2023.
• The company filed its statement of defense in September 2024.
• A third-party appraiser was appointed in June 2025 to assess damages.
• The company evaluates the claim at a nominal sum of NIS 175,000 (approximately $53,000) at this stage.

Stakeholder Impact

• Shareholders: Potential for significant dilution due to ongoing equity raises (ATM offering, shares issued for ShoeSizeMe acquisition) and future capital needs. Risk of further share price decline due to going concern doubts and operational losses.
• Employees: Stock-based compensation and option repricing aim to retain and incentivize key personnel. New Percentil acquisition involved transferring 17 former employees.
• Customers: Expansion of product offerings through acquisitions (ShoeSizeMe for footwear sizing, New Percentil for resale apparel) aims to enhance customer experience and reduce returns.
• Creditors: Increased liabilities (short-term loans, long-term loans, seller payable) and going concern doubts could raise concerns about repayment ability.
• Suppliers: No specific impact mentioned, but general macroeconomic conditions and company's financial health could indirectly affect relationships.

Next Steps

• Continued commercialization of the company's products.
• Acquisition of additional technology, intellectual property, or businesses.
• Securing sufficient financing through equity sales, debt, or strategic partnerships.
• Actively looking for additional technology and commercial opportunities to increase cash flow.
• Closing down the My Size LLC subsidiary in Russia in the near future.
• Integration of ShoeSizeMe into Naiz Bespoke Technologies, S.L. by March 31, 2026.
• Evaluation and integration of Ten Peacks Ltd. into the wholesaling of footwear segment.
• Finalization of purchase price allocation for New Percentil and ShoeSizeMe acquisitions within one year.
• Monitoring macroeconomic and geopolitical conditions, including tariffs and conflicts.
• Responding to the Shimon Shukron legal complaint, with a third-party appraiser assessing damages.

Key Dates

Recommendation

The company faces substantial doubt about its ability to continue as a going concern, a critical red flag for investors. Despite strategic acquisitions and some revenue growth in the most recent quarter, the company continues to incur significant net losses and negative cash flows from operations. The goodwill impairment charge indicates underlying issues in a key segment. While the company is actively seeking additional financing, the terms may be unfavorable and lead to further significant dilution for existing shareholders. The overall financial instability and high operational burn rate, coupled with geopolitical risks, present a highly speculative and high-risk investment profile. A seasoned investor would likely view the going concern warning and persistent losses as a strong indicator to exit or avoid the stock.

Keywords

AI measurement solutions, e-commerce, apparel sizing, footwear sizing, resale platform, SaaS, Nasdaq Capital Market, MYSZ, SEC filing, 10-Q, financial results, acquisitions, going concern, goodwill impairment, capital raise, Israel, geopolitical risk