Wellgistics Health (MEDS) Financials

Revenue has deteriorated significantly from its 2025 peak. Quarterly revenue rose from $44,540 in Q2 2024 to a high of $12.4 million in Q4 2024, but then declined to $1.56 million in Q1 2026. Q2 2026 revenue improved modestly to $1.78 million, up approximately 14% sequentially, but remained about 77% below Q2 2025 and far below the late-2024 peak.

Gross profitability remains very thin. Q2 2026 gross profit was $182,204, representing a gross margin of approximately 10.2%. This was slightly better than Q1 2026’s 10.9% margin only on a dollar basis and remained insufficient to cover operating expenses. The company also reported a negative gross margin in Q4 2025 because cost of revenue substantially exceeded sales.

• Cash increased substantially during Q2 2026. Cash and equivalents rose to $2.46 million from just $51,730 at the end of Q1, providing more short-term liquidity.
• Q2 revenue showed a modest sequential recovery. Revenue increased to $1.78 million from $1.56 million in Q1 2026, suggesting the recent sales decline may have temporarily stabilized.
• Operating losses improved compared with the second half of 2025. The Q2 2026 operating loss was $7.35 million, an improvement from losses of $25.35 million in Q4 2025 and $31.55 million in Q3 2025, although it worsened from $6.02 million in Q1 2026.
• Cash generation depends heavily on financing. The company used $2.89 million in operating cash and $242,132 in investing cash during Q2, while financing activities supplied $5.54 million. This produced a $2.40 million increase in cash, but the improvement was not generated by the underlying business.
• Large non-cash adjustments are affecting reported results. Q2 operating cash flow benefited from $11.33 million of non-cash adjustments, $1.19 million of amortization, and $2.93 million from changes in operating assets and liabilities. Investors should therefore review the composition and sustainability of these adjustments.
• Net losses remain severe. Q2 2026 net loss was $18.36 million, or $7.13 per basic share, compared with a $7.74 million loss in Q1. The loss was driven in part by $10.44 million of interest expense, which was substantially higher than the $1.81 million reported in Q1.
• Operating expenses continue to overwhelm gross profit. Selling, general and administrative expense reached $7.06 million in Q2 2026, nearly 39 times gross profit. Total operating expenses were $7.53 million, leaving the company with a deeply negative operating margin.
• The balance sheet shows significant financial distress. Total liabilities of $52.26 million exceeded total assets of $32.76 million, producing negative shareholders’ equity of $19.50 million. Negative equity also existed in Q1 and worsened from $15.06 million.
• Liquidity is weak despite the increase in cash. Current assets of $5.63 million were far below current liabilities of $39.41 million, implying a current ratio of approximately 0.14. Short-term debt alone was $19.21 million, while accounts payable and accrued expenses totaled nearly $19.64 million.
• Debt and dilution remain important risks. Total reported debt increased to approximately $31.81 million by Q2 2026, and the company has repeatedly relied on debt financing and equity issuance to fund operations. The balance sheet also contains approximately $26.15 million of goodwill and intangible assets, leaving limited tangible asset support for creditors and shareholders.

Overall, the statements point to a company with a small and recently stabilizing revenue base but persistent operating losses, substantial interest costs, negative equity, and recurring dependence on external financing. The Q2 cash increase improves near-term liquidity, but investors should determine whether management can restore revenue growth and reduce expenses before available financing is exhausted.

Note: The supplied filings identify the reporting company as DataMeds AI, Inc., while the requested analysis references Wellgistics Health. Investors should verify the issuer and ticker identity before relying on these figures.