TEN (XHLD) Financials

TEN Holdings’ Q1 2026 results showed improved revenue and a narrower loss compared with Q4 2025, but the company continued to consume cash and had only $79,000 of cash and equivalents at March 31, 2026. The available data covers quarterly periods from Q1 2024 through Q1 2026, rather than four complete years.

Revenue increased to $853,000 in Q1 2026 from $706,000 in Q4 2025 and $543,000 in Q3 2025. However, revenue remained below the $1.12 million reported in Q1 2024. Gross profit was relatively stable at $546,000, but the gross margin fell to approximately 64% from nearly 77% in Q4 as cost of revenue rose faster than sales.

Operating expenses improved substantially. Selling, general and administrative expense declined to $3.38 million from $5.77 million in Q4 2025, helping reduce the operating loss to $2.84 million from $5.38 million. The net loss narrowed to $2.90 million, compared with $9.90 million in Q4, although TEN remained unprofitable and reported a diluted loss of $0.73 per share.

• Revenue growth resumed: Q1 2026 revenue rose approximately 21% sequentially to $853,000, marking the second consecutive quarterly increase.
• Operating losses narrowed: The operating loss improved to $2.84 million from $5.38 million in Q4 2025, primarily because SG&A expense fell by approximately 41%.
• Net loss improved materially: The quarterly net loss declined from $9.90 million in Q4 2025 to $2.90 million in Q1 2026, and interest expense also decreased to $61,000 from $76,000.
• Debt declined during the quarter: The company repaid $450,000 of debt and reported short-term debt of $3.02 million at March 31, down from $4.57 million at the end of Q3 2025.
• Capital spending was limited: TEN reported no purchases of property, plant and equipment in Q1 2026, compared with $22,000 in Q4 and $298,000 in Q3 2025.
• Working capital is concentrated in receivables and prepaids: Accounts receivable totaled $4.90 million and prepaid expenses totaled $2.41 million, together representing most of current assets. The quality and collectability of these balances are important to the company’s liquidity.
• Share-count data is volatile: Weighted average diluted shares increased to approximately 4.0 million in Q1 2026 from 2.3 million in Q4, while earlier quarters reported substantially higher figures. This suggests corporate actions or capital-structure changes and makes per-share comparisons difficult.
• Operating cash flow remained negative: TEN used $1.10 million in cash from operations in Q1 2026, following outflows of $1.03 million in Q4, $1.46 million in Q3 and $792,000 in Q2 2025.
• Liquidity is very limited: Cash and equivalents fell to just $79,000 from $310,000 at the end of Q3 2025. Although current assets exceeded current liabilities, the company’s cash balance alone is insufficient to fund its ongoing operating losses.
• Accumulated losses and leverage remain significant: Retained earnings were negative $24.33 million, total liabilities were $6.32 million, and shareholders’ equity declined to $1.66 million from $3.78 million at September 30, 2025.

Overall, the quarter contained some operational improvements, particularly higher revenue, lower SG&A spending and a smaller net loss. Nevertheless, negative operating cash flow, minimal cash reserves, substantial accumulated losses and reliance on external financing remain major risks. TEN’s financial outlook will depend on whether revenue growth continues and whether management can reduce expenses enough to reach positive operating cash flow without issuing additional debt or equity.