BMRA

MKT CAP $7.9MP/E —DIV YIELD —FCF YIELD —REV TTM $4.5M −16.2%NET INCOME −$3.8MNET CASH —52W 1.49 – 3.20SEC XBRL · TTM TO Invalid Date

How BMRA rewrote its risk factors

10-K ITEM 1A · FY2025 → FY2026

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New in FY2026

RISKS RELATED TO OUR BUSINESS We have a history of operating losses and negative cash flows from operations.
We have a history of operating losses and negative cash flows from operations, and there is no guarantee that we will achieve profitability or positive cash flows in the future.
Failure to achieve or sustain profitability or positive cash flows could result in a decline in the value of our common stock and may necessitate seeking additional funding under potentially unfavorable conditions.
Although our financial statements have been prepared on a going concern basis, our current level of cash and cash equivalents is not sufficient to meet our operating plans for the next 12 months, raising substantial doubt regarding our ability to continue as a going concern.
Our financial statements as of May 31, 2026, have been prepared under the assumption that we will continue as a going concern.
Despite our financing activities, we continue to experience recurring losses and negative cash flows from operations.
Based on our current operating plan, we believe that our existing cash and cash equivalents will be insufficient to fund our operations and meet our obligations for the next twelve months from the issuance date of our financial statements.
Our independent registered public accounting firm’s report on our consolidated financial statements includes an explanatory paragraph regarding substantial doubt about our ability to continue as a going concern.
If we are unable to generate sufficient cash flows from operations or obtain additional financing, we may be required to delay or reduce certain operating activities and expenditures.
Our operating results may fluctuate adversely as a result of many factors that are outside our control, which could adversely affect our business and the market price of our common stock.
Our operating results are subject to fluctuations due to factors outside our control, which may adversely affect our business, financial condition, results of operations and stock price.
Key factors include: ● Regulatory Clearances: Delays or issues with obtaining or maintaining required regulatory clearances, approvals, or registrations in the United States, Europe, and other markets. ● Regulatory Compliance: Challenges in meeting compliance requirements in various jurisdictions. ● Competition: Introduction of superior or lower-priced products by competitors could impact our market share. ● Reimbursement Changes: Alterations in reimbursement systems and/or reduction or elimination in reimbursement amounts could affect product usage decisions. ● Economic Conditions: Economic downturns, changes in healthcare spending, reduced consumer demand, inflation, and currency fluctuations. ● Legal and Regulatory Changes: New or amended laws and regulations affecting our business operations. ● Market Penetration: Lower than expected adoption of new or recently introduced products. ● Distributor Dynamics: Variability in distributor inventory levels, buying patterns, and overall performance. ● International Trade and Geopolitical Risks: Changes in tariffs, international trade policies, trade regulations, wars, political instability, supply-chain disruptions, or logistical constraints could increase the cost of, or delay the availability of, materials and components used in our manufacturing processes and could adversely affect our ability to sell finished products in international markets. ● Healthcare Market Changes: Consolidation in our customer base or shifts in the healthcare market landscape.
Fluctuations in our operating results, for any reason, could cause increased operating losses as a result of significant fixed expenses.
If end-user consumption is less than estimated, revenues from our distribution partners and other distribution channels could fall short of expectations, and because such a significant portion of our costs is fixed, such revenue shortfalls could result in operating losses.
Our revenues have declined, and there is no assurance that we will reverse this trend.
Our net sales decreased from approximately $5,311,000 in fiscal 2025 to approximately $4,453,000 in fiscal 2026, a decline of approximately 16%.
This decline was driven in part by distributor ordering patterns and the timing of international shipments.
We cannot assure you that our revenues will stabilize or increase in future periods.
Continued revenue declines could increase our operating losses, accelerate our use of cash, and increase our dependence on external financing, any of which could materially adversely affect our business, financial condition, and results of operations.
To remain competitive, we must continue to develop, obtain, and protect our proprietary technologies and intellectual property rights; otherwise, we may lose market share or need to reduce prices as a result of competitors selling technologically superior products that compete with our products or selling products at lower prices.
Our ability to compete successfully in the diagnostic market depends on the continued development and introduction of new products, technology, and the improvement of existing products and technologies.
If we cannot continue to improve upon or develop, obtain, and protect our proprietary technologies and intellectual property rights, our operating results could be adversely affected.
Our operations could be adversely affected if our operating results do not correspondingly increase with our increased expenditures or if our technology, product, and market development efforts are unsuccessful or delayed.
We are required to obtain and maintain applicable governmental or regulatory clearances, approvals, registrations or certifications in many countries and regions to sell our products in those countries or regions.
There is no assurance that we will be able to obtain or maintain such regulatory authorizations in the future.
This includes the risk that certain of our products may not satisfy applicable EU IVDR testing and documentation requirements as described in the “Research and Development” section of this Annual Report.
A large part of our sales is to distributors in Europe, China, and other countries, which require us to maintain certain certifications or other regulatory authorizations to sell our products.
Failure to comply with current governmental regulations and quality assurance guidelines could cause the loss of these certifications, which could materially adversely affect our results of operations.
Also, evolving EU IVDR requirements may increase compliance costs and extend certification timelines, which could limit or delay our ability to market certain products in the EU.
We maintain a manufacturing plant in Mexico which presents risks to us including risks associated with doing business outside the United States.
Additionally, there is a risk of labor shortages or increased labor costs, which could affect our manufacturing capabilities.
These factors could lead to unforeseen costs and disruptions, and could have a material adverse effect our business, financial results, and operational stability.
Our research and production processes involve the use of hazardous materials, which present inherent risks.
In the event of an accident, we could face significant liability for harm or damage, potentially exceeding our financial resources.
Our net sales were approximately $4,453,000 for the fiscal year ended May 31, 2026, compared to $5,311,000 for the fiscal year ended May 31, 2025.
For each of the fiscal years ended May 31, 2026 and 2025, our largest distributor accounted for 31% of our net sales.
Total gross receivables as of May 31, 2026, and 2025 were approximately $823,000 and $757,000, respectively.
As of May 31, 2026 and 2025, we had three and four distributors, respectively, that accounted for a total of 59% and 69% of gross accounts receivable, respectively.
Of the 59% as of May 31, 2026, 34% was owed by two distributors in North America.
We rely on distributor organizations and sales agents to market and sell our products abroad, which exposes us to various international risks, including: ● Compliance Challenges: We must adhere to diverse and evolving registration requirements, which can be controlled by distributors, complicating transitions and limiting our ability to benefit from product registrations. ● Regulatory Risks: We must comply with complex foreign and the United States laws and regulations, such as import/export limitations, the Foreign Corrupt Practices Act, and local laws in each market. ● Tariffs and Trade Barriers: As we expand into new countries and regions, we face changing tariffs and trade barriers, including changes in trade policies involving China and other significant international markets, which could increase costs, delay shipments, reduce demand or otherwise adversely affect our sales. ● Currency Exchange Fluctuations: Our international sales are subject to currency risks, as changes in the values of foreign currencies relative to the United States dollar can make our products more expensive and negatively impact sales. ● Payment and Pricing Challenges: We encounter longer payment cycles, generally lower average selling prices, and greater difficulty in collecting accounts receivable. ● Legal Enforceability: We may lack the ability to enforce receivables collections contracts in foreign legal systems. ● Intellectual Property Risks: There is often reduced protection for, and enforcement of, intellectual property rights in foreign markets. ● Political and Economic Instability: We are exposed to political and economic instability in regions where we currently sell or plan to expand our product sales. ● Tax Consequences: We face complex and potentially adverse tax implications in different jurisdictions. ● Product Diversion: Products sold internationally at lower prices may be diverted back to the United States, affecting our domestic sales.

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Gone since FY2025

RISKS RELATED TO OUR BUSINESS We have a history of operating losses.
We have a history of operating losses, and there is no guarantee that we will achieve profitability in the future.
Failure to achieve or sustain profitability could result in a decline in the value of our common stock and may necessitate seeking additional funding under potentially unfavorable conditions.
Although our financial statements have been prepared on a going concern basis, our current level of cash and cash equivalents available to us is not sufficient to meet our operating plans for the next 12 months, raising substantial doubt regarding our ability to continue as a going concern.
Our financial statements as of May 31, 2025, have been prepared under the assumption that we will continue as a going concern for the next twelve months from the date of issuance.
However, our independent registered public accounting firm has issued a report that includes an explanatory paragraph highlighting our operational losses and expressing substantial doubt about our ability to continue as a going concern for a period of at least the next twelve months from the date this report is filed.
Our operating results may fluctuate adversely as a result of many factors that are outside our control, which may negatively impact our stock price.
Our operating results are subject to fluctuations due to factors outside our control, which may adversely affect our business, financial condition, and stock price.
Key factors include: ● Regulatory Clearances: Delays or issues with obtaining regulatory approvals in the U.S., Europe, and other markets. ● Regulatory Compliance: Challenges in meeting compliance requirements in various jurisdictions. ● Competition: Introduction of superior or lower-priced products by competitors could impact our market share. ● Reimbursement Changes: Alterations in reimbursement systems or amounts could affect product usage decisions. ● Economic Conditions: Economic downturns, changes in healthcare spending, reduced consumer demand, inflation, and currency fluctuations. ● Legal and Regulatory Changes: New or amended laws and regulations affecting our business operations. ● Market Penetration: Lower than expected adoption of new or recently introduced products. ● Distributor Dynamics: Variability in distributor inventory levels, buying patterns, and overall performance. ● Government Mandates: Risks from shelter-in-place orders, lockdowns, or other crisis-related directives. ● Tariffs: Potential of order holds or sales delays or reductions due to Tariffs ● Healthcare Market Changes: Consolidation in our customer base or shifts in the healthcare market landscape.
Fluctuations in our operating results, for any reason, could cause operating losses as a result of significant fixed expenses.
If end-user consumption is less than estimated, revenues from our distribution partners and other distribution channels would be expected to fall short of expectations, and because such a significant portion of our costs are fixed, could result in operating losses.
To remain competitive, we must continue to develop, obtain, and protect our proprietary technology rights; otherwise, we may lose market share or need to reduce prices as a result of competitors selling technologically superior products that compete with our products, or selling products at lower prices.
Our ability to compete successfully in the diagnostic market depends on continued development and introduction of new products, technology, and the improvement of existing technology.
If we cannot continue to improve upon or develop, obtain, and protect our technology, our operating results could be adversely affected.
Our operations will be adversely affected if our operating results do not correspondingly increase with our increased expenditures or if our technology, product, and market development efforts are unsuccessful or delayed.
The Company is required to obtain government or regulatory certification in many countries and the European community to sell its products in those countries or regions.
There is no assurance that the Company will be able to retain its certification in the future.
This includes the possibility and risk that the Company’s products do not meet the new EU IVDR testing and documentation requirements in the future as described in the above “Research and Development” section of this document.
A large part of the Company’s sales is to distributors in Europe, China, and other countries, which require us to maintain certain certifications to sell our products.
Failure to comply with current governmental regulations and quality assurance guidelines could cause the loss of these certifications, which could materially adversely affect the results of the Company.
Also, evolving EU IVDR requirements may increase compliance costs and extend certification timelines, which could limit our ability to sell certain IVDD products in the EU.
The Company maintains a manufacturing plant in Mexico which presents risks to the Company including risks associated with doing business outside the United States.
Additionally, there is a risk of labor shortages, which could affect our manufacturing capabilities.
These factors could lead to unforeseen costs and disruptions, materially impacting our business, financial results, and operational stability.
Our research and production processes involve the use of hazardous materials, which presents inherent risks.
In the event of an accident, we could face significant liability for harm or damages, potentially exceeding our financial resources.
Our net sales were approximately $5,311,000 for fiscal year ended May 31, 2025, compared to $5,415,000 for fiscal year eneded May 31, 2024.
For the fiscal years ended May 31, 2025 and 2024, the Company had one distributor each year that accounted for 31% and 33% of our net sales, respectively.
Total gross receivables as of May 31, 2025, and 2024 were approximately $757,000 and $966,000, respectively.
As of May 31, 2025 and 2024, the Company had four distributors, respectively, that accounted for a total of 69% and 64% of gross accounts receivable, respectively.
Of the 69% as of May 31, 2025, 27% was owed by a distributor in North America.
We face risks relating to our international sales, including economic, political, and regulatory challenges, which could impact our financial performance, disrupt our business operations, and hinder our growth strategy.
We rely on distributor organizations and sales agents to market and sell our products abroad, which exposes us to various foreign risks, including: ● Compliance Challenges: We must adhere to diverse and evolving registration requirements, which can be controlled by distributors, complicating transitions and limiting our ability to benefit from product registrations. ● Regulatory Risks: We must comply with complex foreign and U.S. laws and regulations, such as import/export limitations, the Foreign Corrupt Practices Act, and local laws in each market. ● Tariffs and Trade Barriers: As we expand into new countries and regions, we face changing tariffs and trade barriers, particularly in China which accounts for a large percentage of our sales, and where tariff policies are troublesome. ● Currency Exchange Fluctuations: Our international sales are subject to currency risks, as changes in the values of foreign currencies relative to the U.S. dollar can make our products more expensive and negatively impact sales. ● Payment and Pricing Challenges: We encounter longer payment cycles, generally lower average selling prices, and greater difficulty in collecting accounts receivable. ● Legal Enforceability: We may lack the ability to enforce receivables collections contracts in foreign legal systems. ● Intellectual Property Risks: There is often reduced protection for, and enforcement of, intellectual property rights in foreign markets. ● Political and Economic Instability: We are exposed to political and economic instability in regions where we currently sell or plan to expand our product sales. ● Tax Consequences: We face complex and potentially adverse tax implications in different jurisdictions. ● Product Diversion: Products sold internationally at lower prices may be diverted back to the United States, affecting our domestic sales.
Most of our international sales are negotiated and paid in U.S. dollars.
Political tensions between the U.S. and China could disrupt or reduce our sales in the Chinese market, posing a substantial risk to our business.
In certain markets, tariff changes and related trade uncertainties contributed to extended lead times and rescheduled shipments, which affected the timing of revenue recognition for certain international orders.
Our business strategy contemplates further growth, including scaling up our operational systems and entering new geographical markets, including those outside the United States.
We rely on IP for the current products we sell and for the new products in research, development, and in clinical trials.
While the Company tries to protect its IP with confidentiality agreements and internal policies, we still face risks that our IP will be stolen or otherwise misappropriated, by parties inside or outside of the United States.
Further, we have filed many patents around the world on much of the research and development done by the Company, and the proposed products to come from this research.

and 39 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2025 ↗, FY2026 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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