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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2024
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
Commission File Number: 001-37941
SENESTECH, INC.
(Exact name of registrant as specified in its charter)
Delaware20-2079805
(State or other jurisdiction of
incorporation or organization)		(I.R.S. Employer
Identification No.)
23460 N 19th Ave, Suite 110
Phoenix, AZ
85027
(Address of principal executive offices)(Zip Code)
(928) 779-4143
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.001 par valueSNESThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated fileroAccelerated filero
Non-accelerated filerxSmaller reporting companyx
Emerging growth companyo
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
The number of shares of common stock outstanding as of May 7, 2024: 5,144,632

SENESTECH, INC.
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2024
TABLE OF CONTENTS

PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
SENESTECH, INC.
CONDENSED BALANCE SHEETS
(In thousands, except shares and per share data)
March 31,
2024		December 31, 2023
ASSETS(unaudited)
Current assets:
Cash and cash equivalents$3,562 $5,395 
Accounts receivable, net161 95 
Prepaid expenses346 388 
Inventory, net874 795 
Total current assets4,943 6,673 
Right to use assets, operating leases154 210 
Property and equipment, net353 388 
Other noncurrent assets22 22 
Total assets$5,472 $7,293 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$116 $150 
Accrued expenses391 368 
Current portion of operating lease liability159 217 
Current portion of note payable34 33 
Deferred revenue15 18 
Total current liabilities715 786 
Note payable, less current portion147 156 
Total liabilities862 942 
Commitments and contingencies (see notes)
Stockholders’ equity:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding
— — 
Common stock, $0.001 par value, 100,000,000 shares authorized, 5,144,632 shares and 5,140,024 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively
5 5 
Additional paid-in capital136,350 136,259 
Accumulated deficit(131,745)(129,913)
Total stockholders’ equity4,610 6,351 
Total liabilities and stockholders’ equity$5,472 $7,293 
See accompanying notes to condensed financial statements.
1
SENESTECH, INC.
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except shares and per share data)
(Unaudited)
Three Months Ended March 31,
20242023
Revenues, net$415 $233 
Cost of sales280 141 
Gross profit135 92 
Operating expenses:
Research and development370 387 
Selling, general and administrative1,608 1,750 
Total operating expenses1,978 2,137 
Loss from operations(1,843)(2,045)
Other income (expense):
Interest income15 8 
Interest expense(4)— 
Other income, net11 8 
Net loss and comprehensive loss$(1,832)$(2,037)
Weighted average shares outstanding - basic and diluted5,144,531171,047
Net loss per share - basic and diluted$(0.36)$(11.91)
See accompanying notes to condensed financial statements.
2
SENESTECH, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months Ended
March 31,
20242023
Cash flows from operating activities:
Net loss$(1,832)$(2,037)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization37 36 
Stock-based compensation85 166 
Bad debt expense— (2)
Changes in operating assets and liabilities:
Accounts receivable(66)69 
Prepaid expenses42 28 
Inventory(79)38 
Other assets(2)(1)
Accounts payable(34)(325)
Accrued expenses23 24 
Deferred revenue(3)(11)
Net cash used in operating activities(1,829)(2,015)
Cash flows from investing activities:
Purchase of property and equipment(2)(1)
Net cash used in investing activities(2)(1)
Cash flows from financing activities:
Repayments of notes payable(8)— 
Proceeds from the exercise of warrants6 — 
Payment of employee withholding taxes related to share based awards— (11)
Net cash used in financing activities(2)(11)
Decrease in cash and cash equivalents(1,833)(2,027)
Cash and cash equivalents, beginning of period5,395 4,775 
Cash and cash equivalents, end of period$3,562 $2,748 
Supplemental cash flow information is as follows:
Cash paid for interest$4 $— 
Cash paid for income taxes$— $— 
See accompanying notes to condensed financial statements.
3
SENESTECH, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1: BASIS OF PRESENTATION
Nature of Business
SenesTech, Inc. (subsequently referred to in this report as “we,” “us,” “our,” or “our company”) was incorporated in the state of Nevada in July 2004. On November 12, 2015, we subsequently reincorporated in the state of Delaware. Our corporate headquarters and manufacturing site are in Phoenix, Arizona. We have developed and are commercializing a global, proprietary technology for managing animal pest populations, initially rat populations, through fertility control. Our first product is known as ContraPest®.
ContraPest is a liquid bait containing the active ingredients 4-vinylcyclohexene diepoxide and triptolide. ContraPest limits reproduction of male and female rats beginning with the first breeding cycle following consumption. ContraPest is being marketed for use in controlling Norway and roof rat populations. In addition to the U.S. Environmental Protection Agency registration of ContraPest, we must obtain registration from the various state regulatory agencies prior to selling in each state. To date, we have received registration for ContraPest in all 50 states and the District of Columbia, 49 of which have approved the removal of the Restricted Use designation, as well as the District of Columbia and five major U.S. territories.
In November 2023, we launched our latest product EvolveTM, a soft bait containing the active ingredient cottonseed oil. Evolve limits reproduction of male and female rats after one to two breeding cycles following consumption. Evolve is considered a minimum risk pesticide under the U.S. Environmental Protection Agency Federal Insecticide, Fungicide, and Rodenticide Act, Section 25(b). We must obtain registration from the various state regulatory agencies that do not accept the federal exemption. To date, we are authorized to sell Evolve in 33 states.
Going Concern
Our condensed financial statements as of March 31, 2024 were prepared under the assumption that we would continue as a going concern. The reports of our independent registered public accounting firm that accompanies our financial statements for each of the years ended December 31, 2023 and December 31, 2022 contain a going concern qualification in which such firm expressed substantial doubt about our ability to continue as a going concern, based on the financial statements at that time. Specifically, we have incurred operating losses since our inception, and we expect to continue to incur significant expenses and operating losses for the foreseeable future. These prior losses and expected future losses have had, and will continue to have, an adverse effect on our financial condition. If we encounter continued issues or delays in the commercialization of fertility control products, our expected future losses could have an adverse effect on our financial condition and negatively impact our ability to fund continued operations, obtain additional financing in the future and continue as a going concern. There are no assurances that such financing, if necessary, will be available to us at all or will be available in sufficient amounts or on reasonable terms. Our financial statements do not include any adjustments that may result from the outcome of this uncertainty. If we are unable to generate additional funds in the future through additional financings, sales of our products, licensing fees, royalty payments or from other sources or transactions, we will exhaust our resources and will be unable to continue operations.
Liquidity and Capital Resources
Since our inception, we have sustained significant operating losses in the course of our research and development and commercialization activities and expect such losses to continue for the near future. We have generated limited revenue to date from product sales, research grants and licensing fees received under a former license agreement. We have primarily funded our operations to date through the sale of equity securities, including convertible preferred stock, common stock and warrants to purchase common stock.
We have also raised capital through debt financing, consisting primarily of convertible notes and government loan programs, and, to a lesser extent, payments received in connection with product sales, research grants and licensing fees.
As of March 31, 2024, we had an accumulated deficit of $131.7 million and cash and cash equivalents of $3.6 million.
Our ultimate success depends upon the outcome of a combination of factors, including the following: (i) successful commercialization of fertility control products and maintaining and obtaining regulatory approval of our products and
4
product candidates; (ii) market acceptance, commercial viability and profitability of fertility control products and other products; (iii) the ability to market our products and establish an effective sales force and marketing infrastructure to generate significant revenue; (iv) the success of our research and development; (v) the ability to retain and attract key personnel to develop, operate and grow our business; and (vi) our ability to meet our working capital needs.
Based upon our current operating plan, we expect that cash and cash equivalents at March 31, 2024, in combination with anticipated revenue and any additional sales of our equity securities, will be sufficient to fund our current operations for at least the next six months.
While we have evaluated and continue to evaluate our operating expenses and concentrate our resources toward the successful commercialization of fertility control products in the United States, additional financing will be needed before achieving anticipated revenue targets and margin targets. If we are unable to raise necessary capital through the sale of our securities, we may be required to take other measures that could impair our ability to be successful and operate as a going concern. In any event, additional capital is needed in order to fund our operating losses and research and development activities before we become profitable. We may never achieve profitability or generate positive cash flows, and unless and until we do, we will continue to need to raise capital through equity or debt financing. If such equity or debt financing is not available at adequate levels or on acceptable terms, we may need to delay, limit or terminate commercialization and development efforts or discontinue operations.
Condensed Financial Statements
Our accompanying unaudited condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with the U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. In our opinion, the unaudited condensed financial statements include all material adjustments, all of which are of a normal and recurring nature, necessary to present fairly our financial position as of March 31, 2024, and our operating results and cash flows for the three month periods ended March 31, 2024 and 2023. The accompanying financial information as of December 31, 2023 is derived from audited financial statements. Interim results are not necessarily indicative of results for a full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 21, 2024.
Recent Accounting Pronouncements
There have been no new accounting pronouncements not yet effective or adopted in the current year that we believe have a significant impact, or potential significant impact, to our condensed financial statements.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and classification of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. The significant estimates in our financial statements include the valuation of inventory, common stock warrants, and stock-based awards, such as stock options and restricted stock units. Actual results could differ from such estimates.
Advertising Costs
Advertising costs are expensed as incurred and was $61,000 and $41,000 for the three months ended March 31, 2024 and 2023.
Comprehensive Loss
We have no other comprehensive income items for the periods presented. As a result, our net loss and comprehensive loss were the same for the periods presented and a separate statement of comprehensive loss is not included in the accompanying condensed financial statements.
5
NOTE 2: BALANCE SHEET COMPONENTS
Cash and Cash Equivalents
Highly liquid investments with maturities of three months or less as of the date of acquisition are classified as cash equivalents, of which we had $3.6 million and $5.4 million as of March 31, 2024 and December 31, 2023, respectively, included within cash and cash equivalents in the condensed balance sheets.
Accounts Receivable, Net
Accounts receivable, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Accounts receivable$165 $99 
Allowance for uncollectible accounts(4)(4)
Accounts receivable, net$161 $95 
The following was the activity in the allowance for uncollectible accounts (in thousands):
Three Months Ended
March 31,
20242023
Balance as of beginning of period$4 $6 
Increase in provision— — 
Amounts written off, less recoveries— (2)
Balance as of end of period$4 $4 
Inventory, net
Inventory, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Raw materials$797 $747 
Work in progress11 — 
Finished goods71 53 
Total inventory879 800 
Less: reserve for obsolescence(5)(5)
Inventory, net$874 $795 
The following was the activity in the reserve for obsolescence (in thousands):
Three Months Ended
March 31,
20242023
Balance as of beginning of period$5 $18 
Increase in reserve— — 
Amounts relieved— — 
Balance as of end of period$5 $18 
6
Prepaid Expenses
Prepaid expenses consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Software licenses139 152 
Professional services66 30 
Insurance49 64 
Deposit on equipment purchase25 — 
Patents9 14 
Prepaid inventory8 111 
Other50 17 
Total prepaid expenses$346 $388 
Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Research and development equipment$1,763 $1,763 
Office and computer equipment808 808 
Autos54 54 
Furniture and fixtures41 41 
Leasehold improvements143 141 
Total in service2,809 2,807 
Accumulated depreciation and amortization(2,456)(2,419)
Property and equipment, net$353 $388 
Accrued Expenses
Accrued expenses consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Compensation, severance and related benefits$285 $232 
Legal and consulting professional services27 121 
Product warranty12 15 
Other67 — 
Total accrued expenses$391 $368 
Notes Payable
In 2023, we arranged financing for the purchase of certain equipment. The notes payable for that certain equipment have an annual interest rate of 9.1% with a term of five years and is secured by the underlying equipment.
7
As of March 31, 2024, future principal payments were as follows (in thousands):
2024$25 
202536 
202639 
202743 
202838 
Total principal payments181 
Less: current portion of notes payable(34)
Notes payable, less current portion$147 
NOTE 3: FAIR VALUE MEASUREMENTS
The carrying amounts of our financial instruments, including accounts payable and accrued liabilities, approximate fair value due to their short maturities. Notes payable are recorded at amortized cost, which approximates fair value.
NOTE 4: LEASES
We have operating leases for our corporate headquarters and our manufacturing and research facility, which expire in 2024. The components of lease cost were as follows (in thousands):
Three Months Ended
March 31,
20242023
Operating lease cost$56 $56 
As of March 31, 2024, maturities of operating lease liabilities were as follows (in thousands):
2024$164 
Total operating lease payments164 
Less: imputed interest(5)
Total operating lease liabilities$159 
NOTE 5: STOCK-BASED COMPENSATION
In 2018, our stockholders approved the adoption of the SenesTech, Inc. 2018 Equity Incentive Plan (the “2018 Plan”) which provides for the issuance of stock-based instruments, such as stock options or restricted stock units, to employees or consultants as deemed appropriate. The 2018 Plan has since been amended and restated on certain occasions, most recently on June 26, 2023, when our stockholders approved an increase to the total number of authorized shares to 70,717 shares.
Currently, we only have stock options outstanding under the 2018 Plan, which are generally issued with a per share exercise price equal to the fair market value of our common stock at the date of grant. Options granted generally vest immediately, or ratably over a 12- to 36-month period coinciding with their respective service periods, with terms generally of five years. Certain stock option awards provide for accelerated vesting upon a change in control.
As of March 31, 2024, we had 42,049 shares of common stock available for issuance under the 2018 Plan.
8
The following table presents the outstanding stock option activity:
Number of OptionsWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Three months ended March 31, 2024:
Outstanding as of December 31, 202336,708 $119.70 4.0
Forfeited(41)300.62 3.0
Outstanding as of March 31, 202436,667 
(1)
119.49 3.8
(1) Includes options related to 8,249 shares that are inducement awards and not granted under the 2018 Plan.
The stock-based compensation expense was recorded as follows (in thousands):
Three Months Ended
March 31,
20242023
Research and development$4 $4 
Selling, general and administrative (1)
81162
Total stock-based compensation expense$85 $166 
(1) Includes $2,000 related to stock issued in exchange for marketing services for the three months ended March 31, 2023.
The allocation between research and development and selling, general and administrative expense was based on the department and services performed by the employee or non-employee.
At March 31, 2024, the total compensation cost related to unvested options not yet recognized was $207,000, which will be recognized over a weighted average period of 1.1 years, assuming the employees and non-employees complete their service period required for vesting.
9
NOTE 6: STOCKHOLDERS’ EQUITY
Activity in equity during the three month periods ended March 31, 2024 and 2023 was as follows (dollars in thousands):
Common StockAdditional
Paid-In
Capital 		Accumulated
Deficit 		Total
SharesAmount
2024
Balances as of December 31, 20235,140,024 $5 $136,259 $(129,913)$6,351 
Stock-based compensation— — 85 — 85 
Issuance of common stock upon exercise of warrants4,608 — 6 — 6 
Net loss— — — (1,832)(1,832)
Balances as of March 31, 20245,144,632 $5 $136,350 $(131,745)$4,610 
2023
Balances as of December 31, 202267,472 $— $127,482 $(122,203)$5,279 
Stock-based compensation— — 166 — 166 
Issuance of common stock upon exercise of warrants102,500 — — — — 
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes1,102 — (11)— (11)
Issuance of common stock for service4,539 — 100 — 100 
Net loss— — — (2,037)(2,037)
Balances as of March 31, 2023175,613 $— $127,737 $(124,240)$3,497 
NOTE 7: COMMON STOCK WARRANTS
The following table presents the common stock warrant activity:
SharesWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Outstanding as of December 31, 20237,775,734 $2.95 3.4
Exercised(4,608)1.30 — 
Outstanding as of March 31, 20247,771,126 2.95 3.1
During the three months ended March 31, 2024, warrants representing 4,608 shares of common stock were exercised with an exercise price of $1.30 per share.
NOTE 8: LOSS PER SHARE
Basic loss per share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period, which includes prefunded warrants and shares held in abeyance from date of issuance. Diluted loss per share is computed by dividing the loss attributable to common stockholders by the weighted average number of common shares used in the basic loss per share calculation plus potentially dilutive securities outstanding during the period determined using the treasury stock method. Stock options and warrants are considered to be potentially dilutive securities but have been excluded from the calculation of diluted loss per share because their effect would be anti-dilutive given the net losses reported for all periods presented. Therefore, basic and diluted loss per share are the same for each period presented.
10
The following shares were excluded from the calculation of diluted net loss per share:
Three Months Ended
March 31,
20242023
Common stock warrants— 265,401 
Stock options— 23,371 
— 288,772 
NOTE 9: SUBSEQUENT EVENTS
We have evaluated subsequent events from the balance sheet date through May 9, 2024, the date at which the condensed financial statements were issued, and determined that there were no additional items that require adjustment to or disclosure in the condensed financial statements.
11
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations –
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our condensed financial statements and related notes.
Forward-Looking Statements
The statements contained in this Quarterly Report on Form 10-Q that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”). All statements other than statements of historical facts contained or incorporated herein by reference in this Quarterly Report on Form 10-Q, including statements regarding our future operating results, future financial position, business strategy, objectives, goals, plans, prospects, markets, and plans and objectives for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “suggests,” “targets,” “contemplates,” “projects,” “predicts,” “may,” “might,” “plan,” “would,” “should,” “could,” “can,” “potential,” “continue,” “objective,” or the negative of those terms, or similar expressions intended to identify forward-looking statements. However, not all forward-looking statements contain these identifying words. Specific forward-looking statements in this Quarterly Report on Form 10-Q include statements regarding:
•our belief that Evolve is considered a minimum risk pesticide under the United States Environmental Protection Agency’s (the “EPA’s”) Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”), Section 25(b);
•our expectation that we will continue to incur significant expenses and operating losses for the foreseeable future;
•our expectation that cash and cash equivalents at March 31, 2024, in combination with anticipated revenue and any additional sales of our equity securities, will be sufficient to fund our current operations for at least the next six months;
•our expectation that significant operating losses in the course of our research and development and commercialization activities will continue for the near future;
•our expectation that we will continue to incur significant expenses and generate operating losses for at least the next six months;
•our belief that additional financing will be needed before achieving anticipated revenue targets and margin targets;
•our belief that if we are unable to raise necessary capital through the sale of our securities, we may be required to take other measures that could impair our ability to be successful and operate as a going concern;
•our additional capital is needed to fund our operating losses and research and development activities before we become profitable;
•our belief that we may require additional capital in order to fund our operating losses and research and development activities before we become profitable;
•our ability to achieve profitability or generate positive cash flows;
•our expectation that we will incur substantial and increased expenses;
•our belief that we will need additional financing to fund these continuing and additional expenses;
•our belief that if we encounter continued issues or delays in the commercialization of fertility control products, our expected future losses could have an adverse effect on our financial condition and negatively impact our ability to fund continued operations, obtain additional financing in the future and continue as a going concern;
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•our ability to maximize market acceptance for, and generate sales of, our products, including by conducting field demonstrations for potential lead customers;
•our ability to enter into strategic partnerships to enable us to penetrate additional target markets and geographical locations;
•our ability to manage the infrastructure for sales, marketing and distribution of fertility control products and any other product candidates for which we may receive regulatory approval;
•our ability to seek regulatory approvals for fertility control products, including to more fully expand the market and use for fertility control products and, if we believe there is commercial viability, for our other product candidates;
•our ability to further develop our manufacturing processes to contain costs while being able to scale to meet future demand of fertility control products and any other product candidates for which we receive regulatory approval;
•our ability to continue product development of fertility control products and advance our research and development activities and, as our operating budget permits, advance the research and development programs for other product candidates;
•our ability to maintain and protect our intellectual property portfolio;
•our ability to add operational, financial and management information systems and personnel, including personnel to support our product development and commercialization efforts and operations as a public company;
•our expectation that our expenses may continue or increase in connection with our ongoing activities, particularly as we focus on marketing and sales of fertility control products;
•our successful commercialization of fertility control products in the United States;
•our ability to maintain and obtain regulatory approval of our product and product candidates;
•our ability to gain market acceptance, commercial viability and profitability of our fertility control products and any other products;
•our ability to market our products and establish an effective sales force and marketing infrastructure to generate significant revenue;
•the success of our research and development activities;
•our ability to retain and attract key personnel to develop, operate, and grow our business;
•our ability to meet our working capital needs;
•our estimates or expectations related to our revenue, cash flow, expenses, capital requirements and need for additional financing;
•our plans for our business, including for research and development;
•our financial performance, including our ability to fund operations; and
•developments and projections relating to our projects, competitors and our industry, including legislative developments and impacts from those developments.
These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and situations that are difficult to predict and that may cause our own, or our industry’s, actual results to be materially different from the future results that are expressed or implied by these statements. Accordingly, actual results may differ materially from those anticipated or expressed in such statements as a result of a variety of factors, including
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those discussed in Item 1A-“Risk Factors” of Part I of our Annual Report on Form 10-K, for the year ended December 31, 2023, filed with the SEC on February 21, 2024, and those contained from time to time in our other filings with the SEC. A number of factors could cause our actual results to differ materially from those indicated by the forward-looking statements. Such factors include, among others, the following:
•the successful commercialization of our products;
•market acceptance of our products;
•our financial performance, including our ability to fund operations;
•our ability to regain and maintain compliance with Nasdaq’s continued listing requirements;
•regulatory approval and regulation of our products; and
•other factors and risks identified from time to time in our filings with the SEC, including this Quarterly Report on Form 10-Q.
All forward-looking statements included herein are based on information available to us as of the date hereof and speak only as of such date. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. The forward-looking statements contained in or incorporated by reference into this Quarterly Report on Form 10-Q reflect our views as of the date of this Quarterly Report on Form 10-Q about future events and are subject to risks, uncertainties, assumptions and changes in circumstances that may cause our actual results, performance or achievements to differ significantly from those expressed or implied in any forward-looking statement. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future events, results, performance or achievements.
We are subject to the information requirements of the Exchange Act, and we file or furnish reports, proxy statements and other information with the SEC. Such reports and other information we file with the SEC are available free of charge at www.senestech.com as soon as practicable after such reports are available on the SEC’s website at www.sec.gov. The SEC’s website contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
Overview
Since our inception, we have sustained significant operating losses in the course of our research and development and commercialization activities and expect such losses to continue for the near future. Although sales of our product have increased over the last three years, 17% in 2023, 77% in 2022 and 123% in 2021, we are not yet able to fund operations by product sales alone. We have primarily funded our operations to date through the sale of equity securities, including convertible preferred stock, common stock and warrants to purchase common stock. We have also generated limited revenue from research grants and licensing fees received under former license agreements.
Through March 31, 2024, we received net proceeds of $101.8 million from our sales of common stock, preferred stock and warrant exercises and issuance of convertible and other promissory notes, an aggregate of $1.7 million from licensing fees and an aggregate of $4.1 million in net product sales. As of March 31, 2024, we had an accumulated deficit of $131.7 million and cash and cash equivalents of $3.6 million.
We have incurred significant operating losses every year since our inception, with a net loss of $1.8 million for the three months ended March 31, 2024. We expect to continue to incur significant expenses and generate operating losses for at least the next six months.
Our ultimate success depends upon the outcome of a combination of factors, including the following: (i) successful commercialization of fertility control products and maintaining and obtaining regulatory approval of our products and product candidates; (ii) market acceptance, commercial viability and profitability of fertility control products and other products; (iii) the ability to market our products and establish an effective sales force and marketing infrastructure to generate significant revenue; (iv) the success of our research and development; (v) the ability to retain and attract key personnel to develop, operate and grow our business; and (vi) our ability to meet our working capital needs.
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Based upon our current operating plan, we expect that cash and cash equivalents at March 31, 2024, in combination with anticipated revenue and any additional sales of our equity securities, will be sufficient to fund our current operations for at least the next six months.
While we have evaluated and continue to evaluate our operating expenses and concentrate our resources toward the successful commercialization of fertility control products in the United States and internationally, additional financing will be needed before achieving anticipated revenue targets and margin targets. If we are unable to raise necessary capital through the sale of our securities, we may be required to take other measures that could impair our ability to be successful and operate as a going concern. In any event, additional capital is needed in order to fund our operating losses and research and development activities before we become profitable. We may never achieve profitability or generate positive cash flows, and unless and until we do, we will continue to need to raise capital through equity or debt financing. If such equity or debt financing is not available at adequate levels or on acceptable terms, we may need to delay, limit or terminate commercialization and development efforts or discontinue operations.
Results of Operations
The following table summarizes our results of operations for the periods presented (in thousands):
Three Months Ended March 31,% Increase (Decrease)
20242023
Revenues, net$415 $233 78 %
Cost of sales280 141 99 %
Gross profit135 92 47 %
Operating expenses:  
Research and development370 387 (4)%
Selling, general and administrative1,608 1,750 (8)%
Total operating expenses1,978 2,137 (7)%
Loss from operations(1,843)(2,045)(10)%
Other income, net11 8 38 %
Net loss$(1,832)$(2,037)(10)%
Revenues
Sales, net of sales discounts and promotions, were $415,000 for the first quarter of 2024, compared to $233,000 for the first quarter of 2023. The $182,000 increase was driven by the launch of our latest product Evolve in November 2023. Evolve is a soft bait containing the active ingredient cottonseed oil and represented approximately 56%, or $232,000, of revenues for the first quarter of 2023.
Cost of Sales
Cost of sales consisted primarily of the cost of products sold, including scrap and reserves for obsolescence, and was $280,000, or 67.5% of net sales, for the first quarter of 2024, compared to $141,000, or 60.4% of net sales, for the first quarter of 2023. Cost of sales in the first quarter of 2024 was impacted by the higher cost of a key ingredient in our new Evolve product, as we transitioned from development-stage raw materials pricing to production-level raw materials pricing. Cost of sales in the first quarter of 2023 was impacted by the scrapping of defective trays no longer used in our products, which totaled $42,000.
Gross Profit
Gross profit for the first quarter of 2024 was $135,000, for a gross profit margin of 32.5%, compared to a gross profit of $92,000, or a gross profit margin of 39.6%, for the first quarter of 2023. The gross profit margin in the first quarter of 2024 was impacted by both the higher-than-expected cost of a key ingredient in our new Evolve product, combined with an increased proportion of our sales coming from distributors. The gross profit margin in the first quarter of 2023 was impacted by the higher cost of sales related to the scrapping of defective tanks during no longer used in our products.
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Research and Development Expenses
Research and development expenses consisted of the following (in thousands):
Three Months Ended March 31,Increase
(Decrease)
20242023
Personnel (including stock-based compensation)$198 $242 $(44)
Facility-related39 26 13 
Depreciation30 28 2 
Supplies and maintenance28 30 (2)
Professional fees18 44 (26)
Stability studies, materials and testing16 3 13 
Other41 14 27 
Total$370 $387 $(17)
Research and development expenses were $370,000 for the first quarter of 2024, compared to $387,000 for the first quarter of 2023. The $17,000 decrease was primarily due to lower headcount and consulting and legal fees required for research and development purposes, which was partially offset by higher expenses overall related to field and product improvement studies in the first quarter of 2024 when compared with the first quarter of 2023.
Selling, General and Administrative Expenses
Selling, general and administrative expenses consisted of the following (in thousands):
Three Months Ended March 31,Increase
(Decrease)
20242023
Personnel (including stock-based compensation)$862 $903 $(41)
Professional fees314 452 (138)
Marketing73 54 19 
Licensed software69 65 4 
Insurance61 86 (25)
Travel and entertainment59 74 (15)
Facilities40 38 2 
Other130 78 52 
Total$1,608 $1,750 $(142)
Selling, general and administrative expenses were $1.6 million for the first quarter of 2024, as compared to $1.8 million for the first quarter of 2023. The decrease of $142,000 was primarily due to lower professional fees. Consulting fees related to marketing efforts are lower in the first of 2024 when compared with the first quarter of 2023 due to changes in our overall marketing program, while legal fees are lower due to the settlement of a legal matter in November 2023. Additionally, personnel-related expenses were lower due to lower headcount and stock-based compensation and insurance is lower resulting from both policy and rate changes. These decreases were offset by higher franchise fees in the first quarter of 2024 when compared to the first quarter of 2023.
Other Income, Net
Other income, net for the first quarter of 2024 consisted of interest income of $15,000, partially offset by interest expense of $4,000, while the first quarter of 2023 consisted of interest income of $8,000.
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Interest income was higher due to a combination of a higher average balance of cash and cash equivalents and higher interest rate during the first quarter of 2024 when compared with the first quarter of 2023. Interest expense in the first quarter of 2024 relates to the notes payable entered into in late 2023 related to the purchase of certain equipment.
Liquidity and Capital Resources
Liquidity
Since our inception, we have sustained significant operating losses in the course of our research and development activities and commercialization efforts and expect such losses to continue for the near future. We have generated limited revenue to date from product sales, research grants and licensing fees received under a former license. We have primarily funded our operations to date through the sale of equity securities, including convertible preferred stock, common stock and warrants to purchase common stock; and debt financing, consisting primarily of convertible notes.
Through March 31, 2024, we have received net proceeds of $101.8 million from our sales of common stock, preferred stock and warrant exercises and issuance of convertible and other promissory notes, an aggregate of $4.1 million in net product sales and an aggregate of $1.7 million from licensing fees. As of March 31, 2024, we had an accumulated deficit of $131.7 million and cash and cash equivalents of $3.6 million.
Our ultimate success depends upon the outcome of a combination of factors, including the following: (i) successful commercialization of our fertility control products and maintaining and obtaining regulatory approval of our products and product candidates; (ii) market acceptance, commercial viability and profitability of our fertility control products and any other products; (iii) the ability to market our products and establish an effective sales force and marketing infrastructure to generate significant revenue; (iv) the success of our research and development activities; (v) the ability to retain and attract key personnel to develop, operate and grow our business; and (vi) our ability to meet our working capital needs.
Based upon our current operating plan, we expect that cash and cash equivalents at March 31, 2024, in combination with anticipated revenue and any additional sales of our equity securities, will be sufficient to fund our current operations for at least the next six months. We have evaluated and will continue to evaluate our operating expenses and will concentrate our resources toward the successful commercialization of our fertility control products in the United States and internationally. However, if anticipated revenue targets and margin targets are not achieved or expenses are more than we have budgeted, we may need to raise additional financing before that time. If we need more financing, including within the next six months, and we are unable to raise the necessary capital through the sale of our securities, we may be required to take other measures that could impair our ability to be successful and operate as a going concern. In any event, we may require additional capital in order to fund our operating losses and research and development activities before we become profitable and may opportunistically raise capital. We may never achieve profitability or generate positive cash flows, and unless and until we do, we will continue to need to raise capital through equity or debt financing. If such equity or debt financing is not available at adequate levels or on acceptable terms, we may need to delay, limit or terminate commercialization and development efforts or discontinue operations.
Additional Funding Requirements
We expect our expenses to continue or increase in connection with our ongoing activities, particularly as we focus on marketing and sales of fertility control products. In addition, we will continue to incur costs associated with operating as a public company.
In particular, we expect to incur substantial and increased expenses as we:
•work to maximize market acceptance for, and generate sales of, our products, including by conducting field demonstrations for potential lead customers;
•explore strategic partnerships to enable us to penetrate additional target markets and geographical locations;
•manage the infrastructure for sales, marketing and distribution of fertility control products and any other product candidates for which we may receive regulatory approval;
•seek additional regulatory approvals for fertility control products, including to more fully expand the market and use for fertility control products and, if we believe there is commercial viability, for our other product candidates;
17
•further develop our manufacturing processes to contain costs while being able to scale to meet future demand of fertility control products and any other product candidates for which we receive regulatory approval;
•continue product development of fertility control products and advance our research and development activities and, as our operating budget permits, advance the research and development programs for other product candidates;
•maintain and protect our intellectual property portfolio; and
•add operational, financial and management information systems and personnel, including personnel to support our product development and commercialization efforts and operations as a public company.
We will need additional financing to fund these continuing and additional expenses.
Capital Resources
The following table summarizes our sources and uses of cash for each of the periods presented (in thousands):
Three Months Ended March 31,
20242023
Cash and cash equivalents, beginning of period$5,395 $4,775 
Net cash provided by (used in):
Operating activities(1,829)(2,015)
Investing activities(2)(1)
Financing activities(2)(11)
Decrease in cash and cash equivalents(1,833)(2,027)
Cash and cash equivalents, end of period$3,562 $2,748 
Cash Flows from Operating Activities—Cash flows from operating activities are generally determined by the amount and timing of cash received from customers and payments made to vendors, as well as the nature and amount of non-cash items, including depreciation and amortization and stock-based compensation included in operating results during a given period.
During the three months ended March 31, 2024, operating activities used $1.8 million of cash, resulting from our net loss of $1.8 million and net changes in our operating assets and liabilities of $119,000, partially offset by net non-cash charges of $122,000, consisting primarily of stock-based compensation and depreciation and amortization expense. Our net loss was driven by costs related to our selling, general and administrative activities resulting from our continued efforts to commercialize our products, combined with research and development costs. Net cash used by changes in our operating assets and liabilities consisted primarily of increases in inventory of $79,000 and accounts receivable of $66,000, a net decrease in accounts payable and accrued expenses of $11,000, and a decrease in deferred revenue of $3,000, partially offset by decrease in prepaid expenses of $42,000.
During the three months ended March 31, 2023, operating activities used $2.0 million of cash, resulting from our net loss of $2.0 million, partially offset by net changes in our operating assets and liabilities of $178,000 and by non-cash charges of $200,000, consisting primarily of stock-based compensation and depreciation and amortization expense. Our net loss was driven by costs related to our selling, general and administrative activities resulting from our efforts to commercialize our products, combined with our research and development costs. Net cash provided by changes in our operating assets and liabilities consisted of a net decreases in accounts payable and accrued expenses of $301,000, partially offset by increases in accounts receivable of $69,000, inventory of $38,000, and prepaid expenses of $28,000.
Cash Flows from Investing Activities—Cash flows used in investing activities primarily consist of the purchase of property and equipment, offset by any proceeds received in connection with sales of property and equipment. During the three
18
months ended March 31, 2024 and 2023, cash flows used in investing activities consisted of property and equipment purchases.
Cash Flows from Financing Activities—Financing activities provide cash for both day-to-day operations and capital requirements as needed. During the three months ended March 31, 2024, net cash used in financing activities consisted of repayments on notes payable of $8,000, partially offset by proceeds received from the exercise of warrants of $6,000. During the three months ended March 31, 2023, net cash used in financing activities consisted of the payment of employee withholding taxes related to share-based awards.
Critical Accounting Policies and Estimates
There have been no material changes to our critical accounting policies and estimates as previously disclosed in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 21, 2024.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not applicable.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We periodically conduct evaluations (pursuant to Rule 13a-15(b) of the Exchange Act), under the supervision and with the participation of management, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e)) as of the end of the period covered by this report.
These disclosure controls and procedures are designed to ensure that information required to be disclosed in our reports that are filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Our disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that this information is accumulated and communicated to management, including the principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.
Based on the evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that these disclosure controls and procedures were effective as of the end of the period covered by this report.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the period covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II — OTHER INFORMATION
Item 1. Legal Proceedings
From time to time, we may be a party to certain legal proceedings, incidental to the normal course of business. We are not currently a party to any pending or threatened legal proceedings that we believe could have a material adverse effect on our business or financial condition.
Item 1A. Risk Factors
There have been no material changes to our risk factors set forth in Part I, Item 1A, of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 21, 2024.
Item 5. Other Information
During the quarter ended March 31, 2024, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (in each case, as defined in Item 408 of Regulation S-K).
Item 6. Exhibits
Exhibit
Number		Description
31.1
31.2
32.1
32.2
101.INSInline XBRL Instance Document.
101.SCHInline XBRL Taxonomy Extension Schema Document.
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document.
101.LABInline XBRL Taxonomy Extension Label Linkbase Document.
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document.
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
SENESTECH, INC.
Date: May 9, 2024
By:/s/ Joel L. Fruendt
Joel L. Fruendt
President and Chief Executive Officer
Date: May 9, 2024
By:/s/ Thomas C. Chesterman
Thomas C. Chesterman
Executive Vice President, Chief Financial Officer, Treasurer and Secretary
21

Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO
RULE 13(a)-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934
I, Joel L. Fruendt, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of SenesTech, Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Dated: May 9, 2024
/s/ Joel L. Fruendt
Joel L. Fruendt
President and Chief Executive Officer


Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO
RULE 13(a)-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934
I, Thomas C. Chesterman, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of SenesTech, Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Dated: May 9, 2024
/s/ Thomas C. Chesterman
Thomas C. Chesterman
Executive Vice President, Chief Financial Officer, Treasurer and Secretary


Exhibit 32.1
CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, Joel L. Fruendt, President and Chief Executive Officer of SenesTech, Inc., certify that:
1.To my knowledge, the Quarterly Report on Form 10-Q of SenesTech, Inc. for the fiscal quarter ended March 31, 2024 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.To my knowledge, the information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of SenesTech, Inc.
Dated: May 9, 2024
/s/ Joel L. Fruendt
Joel L. Fruendt
President and Chief Executive Officer
This certification accompanies the Quarterly Report on Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of SenesTech, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Quarterly Report on Form 10-Q), irrespective of any general incorporation language contained in such filing.


Exhibit 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, Thomas C. Chesterman, Chief Financial Officer, Treasurer and Secretary of SenesTech, Inc., certify that:
1.To my knowledge, the Quarterly Report on Form 10-Q of SenesTech, Inc. for the fiscal quarter ended March 31, 2024 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.To my knowledge, the information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of SenesTech, Inc.
Dated: May 9, 2024
/s/ Thomas C. Chesterman
Thomas C. Chesterman
Executive Vice President, Chief Financial Officer, Treasurer and Secretary
This certification accompanies the Quarterly Report on Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of SenesTech, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Quarterly Report on Form 10-Q), irrespective of any general incorporation language contained in such filing.

v3.24.1.u1
Document And Entity Information - shares
 3 Months Ended
Mar. 31, 2024
May 07, 2024
Cover [Abstract]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Mar. 31, 2024  
Document Transition Report false  
Entity File Number 001-37941  
Entity Registrant Name SENESTECH, INC.  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 20-2079805  
Entity Address, Address Line One 23460 N 19th Ave,  
Entity Address, Address Line Two Suite 110  
Entity Address, City or Town Phoenix  
Entity Address, State or Province AZ  
Entity Address, Postal Zip Code 85027  
City Area Code (928)  
Local Phone Number 779-4143  
Title of 12(b) Security Common Stock, $0.001 par value  
Trading Symbol SNES  
Security Exchange Name NASDAQ  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding (in shares)   5,144,632
Entity Central Index Key 0001680378  
Current Fiscal Year End Date --12-31  
Document Fiscal Year Focus 2024  
Document Fiscal Period Focus Q1  
Amendment Flag false  
v3.24.1.u1
CONDENSED BALANCE SHEETS - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Current assets:    
Cash and cash equivalents $ 3,562 $ 5,395
Accounts receivable, net 161 95
Prepaid expenses 346 388
Inventory, net 874 795
Total current assets 4,943 6,673
Right to use assets, operating leases 154 210
Property and equipment, net 353 388
Other noncurrent assets 22 22
Total assets 5,472 7,293
Current liabilities:    
Accounts payable 116 150
Accrued expenses 391 368
Current portion of operating lease liability 159 217
Current portion of note payable 34 33
Deferred revenue 15 18
Total current liabilities 715 786
Note payable, less current portion 147 156
Total liabilities 862 942
Commitments and contingencies (see notes)
Stockholders’ equity:    
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding 0 0
Common stock, $0.001 par value, 100,000,000 shares authorized, 5,144,632 shares and 5,140,024 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively 5 5
Additional paid-in capital 136,350 136,259
Accumulated deficit (131,745) (129,913)
Total stockholders’ equity 4,610 6,351
Total liabilities and stockholders’ equity $ 5,472 $ 7,293
v3.24.1.u1
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares
Mar. 31, 2024
Dec. 31, 2023
Statement of Financial Position [Abstract]    
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, shares authorized (in shares) 10,000,000 10,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized (in shares) 100,000,000 100,000,000
Common stock, shares issued (in shares) 5,144,632 5,140,024
Common stock, shares outstanding (in shares) 5,144,632 5,140,024
v3.24.1.u1
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Income Statement [Abstract]    
Revenues, net $ 415 $ 233
Cost of sales 280 141
Gross profit 135 92
Operating expenses:    
Research and development 370 387
Selling, general and administrative 1,608 1,750
Total operating expenses 1,978 2,137
Loss from operations (1,843) (2,045)
Other income (expense):    
Interest income 15 8
Interest expense (4) 0
Other income, net 11 8
Net loss (1,832) (2,037)
Comprehensive loss $ (1,832) $ (2,037)
Weighted average shares outstanding - basic (in shares) 5,144,531 171,047
Weighted average shares outstanding - diluted (in shares) 5,144,531 171,047
Net loss per share - basic (in dollars per share) $ (0.36) $ (11.91)
Net loss per share - diluted (in dollars per share) $ (0.36) $ (11.91)
v3.24.1.u1
CONDENSED STATEMENTS OF CASH FLOWS - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Cash flows from operating activities:    
Net loss $ (1,832,000) $ (2,037,000)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 37,000 36,000
Stock-based compensation 85,000 166,000
Bad debt expense 0 (2,000)
Changes in operating assets and liabilities:    
Accounts receivable (66,000) 69,000
Prepaid expenses 42,000 28,000
Inventory (79,000) 38,000
Other assets (2,000) (1,000)
Accounts payable (34,000) (325,000)
Accrued expenses 23,000 24,000
Deferred revenue (3,000) (11,000)
Net cash used in operating activities (1,829,000) (2,015,000)
Cash flows from investing activities:    
Purchase of property and equipment (2,000) (1,000)
Net cash used in investing activities (2,000) (1,000)
Cash flows from financing activities:    
Repayments of notes payable (8,000) 0
Proceeds from the exercise of warrants 6,000 0
Payment of employee withholding taxes related to share based awards 0 (11,000)
Net cash used in financing activities (2,000) (11,000)
Decrease in cash and cash equivalents (1,833,000) (2,027,000)
Cash and cash equivalents, beginning of period 5,395,000 4,775,000
Cash and cash equivalents, end of period 3,562,000 2,748,000
Supplemental cash flow information is as follows:    
Cash paid for interest 4,000 0
Cash paid for income taxes $ 0 $ 0
v3.24.1.u1
BASIS OF PRESENTATION
 3 Months Ended
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
BASIS OF PRESENTATION BASIS OF PRESENTATION
Nature of Business
SenesTech, Inc. (subsequently referred to in this report as “we,” “us,” “our,” or “our company”) was incorporated in the state of Nevada in July 2004. On November 12, 2015, we subsequently reincorporated in the state of Delaware. Our corporate headquarters and manufacturing site are in Phoenix, Arizona. We have developed and are commercializing a global, proprietary technology for managing animal pest populations, initially rat populations, through fertility control. Our first product is known as ContraPest®.
ContraPest is a liquid bait containing the active ingredients 4-vinylcyclohexene diepoxide and triptolide. ContraPest limits reproduction of male and female rats beginning with the first breeding cycle following consumption. ContraPest is being marketed for use in controlling Norway and roof rat populations. In addition to the U.S. Environmental Protection Agency registration of ContraPest, we must obtain registration from the various state regulatory agencies prior to selling in each state. To date, we have received registration for ContraPest in all 50 states and the District of Columbia, 49 of which have approved the removal of the Restricted Use designation, as well as the District of Columbia and five major U.S. territories.
In November 2023, we launched our latest product EvolveTM, a soft bait containing the active ingredient cottonseed oil. Evolve limits reproduction of male and female rats after one to two breeding cycles following consumption. Evolve is considered a minimum risk pesticide under the U.S. Environmental Protection Agency Federal Insecticide, Fungicide, and Rodenticide Act, Section 25(b). We must obtain registration from the various state regulatory agencies that do not accept the federal exemption. To date, we are authorized to sell Evolve in 33 states.
Going Concern
Our condensed financial statements as of March 31, 2024 were prepared under the assumption that we would continue as a going concern. The reports of our independent registered public accounting firm that accompanies our financial statements for each of the years ended December 31, 2023 and December 31, 2022 contain a going concern qualification in which such firm expressed substantial doubt about our ability to continue as a going concern, based on the financial statements at that time. Specifically, we have incurred operating losses since our inception, and we expect to continue to incur significant expenses and operating losses for the foreseeable future. These prior losses and expected future losses have had, and will continue to have, an adverse effect on our financial condition. If we encounter continued issues or delays in the commercialization of fertility control products, our expected future losses could have an adverse effect on our financial condition and negatively impact our ability to fund continued operations, obtain additional financing in the future and continue as a going concern. There are no assurances that such financing, if necessary, will be available to us at all or will be available in sufficient amounts or on reasonable terms. Our financial statements do not include any adjustments that may result from the outcome of this uncertainty. If we are unable to generate additional funds in the future through additional financings, sales of our products, licensing fees, royalty payments or from other sources or transactions, we will exhaust our resources and will be unable to continue operations.
Liquidity and Capital Resources
Since our inception, we have sustained significant operating losses in the course of our research and development and commercialization activities and expect such losses to continue for the near future. We have generated limited revenue to date from product sales, research grants and licensing fees received under a former license agreement. We have primarily funded our operations to date through the sale of equity securities, including convertible preferred stock, common stock and warrants to purchase common stock.
We have also raised capital through debt financing, consisting primarily of convertible notes and government loan programs, and, to a lesser extent, payments received in connection with product sales, research grants and licensing fees.
As of March 31, 2024, we had an accumulated deficit of $131.7 million and cash and cash equivalents of $3.6 million.
Our ultimate success depends upon the outcome of a combination of factors, including the following: (i) successful commercialization of fertility control products and maintaining and obtaining regulatory approval of our products and
product candidates; (ii) market acceptance, commercial viability and profitability of fertility control products and other products; (iii) the ability to market our products and establish an effective sales force and marketing infrastructure to generate significant revenue; (iv) the success of our research and development; (v) the ability to retain and attract key personnel to develop, operate and grow our business; and (vi) our ability to meet our working capital needs.
Based upon our current operating plan, we expect that cash and cash equivalents at March 31, 2024, in combination with anticipated revenue and any additional sales of our equity securities, will be sufficient to fund our current operations for at least the next six months.
While we have evaluated and continue to evaluate our operating expenses and concentrate our resources toward the successful commercialization of fertility control products in the United States, additional financing will be needed before achieving anticipated revenue targets and margin targets. If we are unable to raise necessary capital through the sale of our securities, we may be required to take other measures that could impair our ability to be successful and operate as a going concern. In any event, additional capital is needed in order to fund our operating losses and research and development activities before we become profitable. We may never achieve profitability or generate positive cash flows, and unless and until we do, we will continue to need to raise capital through equity or debt financing. If such equity or debt financing is not available at adequate levels or on acceptable terms, we may need to delay, limit or terminate commercialization and development efforts or discontinue operations.
Condensed Financial Statements
Our accompanying unaudited condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with the U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. In our opinion, the unaudited condensed financial statements include all material adjustments, all of which are of a normal and recurring nature, necessary to present fairly our financial position as of March 31, 2024, and our operating results and cash flows for the three month periods ended March 31, 2024 and 2023. The accompanying financial information as of December 31, 2023 is derived from audited financial statements. Interim results are not necessarily indicative of results for a full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 21, 2024.
Recent Accounting Pronouncements
There have been no new accounting pronouncements not yet effective or adopted in the current year that we believe have a significant impact, or potential significant impact, to our condensed financial statements.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and classification of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. The significant estimates in our financial statements include the valuation of inventory, common stock warrants, and stock-based awards, such as stock options and restricted stock units. Actual results could differ from such estimates.
Advertising Costs
Advertising costs are expensed as incurred and was $61,000 and $41,000 for the three months ended March 31, 2024 and 2023.
Comprehensive Loss
We have no other comprehensive income items for the periods presented. As a result, our net loss and comprehensive loss were the same for the periods presented and a separate statement of comprehensive loss is not included in the accompanying condensed financial statements.
v3.24.1.u1
BALANCE SHEET COMPONENTS
 3 Months Ended
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
BALANCE SHEET COMPONENTS BALANCE SHEET COMPONENTS
Cash and Cash Equivalents
Highly liquid investments with maturities of three months or less as of the date of acquisition are classified as cash equivalents, of which we had $3.6 million and $5.4 million as of March 31, 2024 and December 31, 2023, respectively, included within cash and cash equivalents in the condensed balance sheets.
Accounts Receivable, Net
Accounts receivable, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Accounts receivable$165 $99 
Allowance for uncollectible accounts(4)(4)
Accounts receivable, net$161 $95 
The following was the activity in the allowance for uncollectible accounts (in thousands):
Three Months Ended
March 31,
20242023
Balance as of beginning of period$4 $6 
Increase in provision— — 
Amounts written off, less recoveries— (2)
Balance as of end of period$4 $4 
Inventory, net
Inventory, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Raw materials$797 $747 
Work in progress11 — 
Finished goods71 53 
Total inventory879 800 
Less: reserve for obsolescence(5)(5)
Inventory, net$874 $795 
The following was the activity in the reserve for obsolescence (in thousands):
Three Months Ended
March 31,
20242023
Balance as of beginning of period$5 $18 
Increase in reserve— — 
Amounts relieved— — 
Balance as of end of period$5 $18 
Prepaid Expenses
Prepaid expenses consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Software licenses139 152 
Professional services66 30 
Insurance49 64 
Deposit on equipment purchase25 — 
Patents9 14 
Prepaid inventory8 111 
Other50 17 
Total prepaid expenses$346 $388 
Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Research and development equipment$1,763 $1,763 
Office and computer equipment808 808 
Autos54 54 
Furniture and fixtures41 41 
Leasehold improvements143 141 
Total in service2,809 2,807 
Accumulated depreciation and amortization(2,456)(2,419)
Property and equipment, net$353 $388 
Accrued Expenses
Accrued expenses consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Compensation, severance and related benefits$285 $232 
Legal and consulting professional services27 121 
Product warranty12 15 
Other67 — 
Total accrued expenses$391 $368 
Notes Payable
In 2023, we arranged financing for the purchase of certain equipment. The notes payable for that certain equipment have an annual interest rate of 9.1% with a term of five years and is secured by the underlying equipment.
As of March 31, 2024, future principal payments were as follows (in thousands):
2024$25 
202536 
202639 
202743 
202838 
Total principal payments181 
Less: current portion of notes payable(34)
Notes payable, less current portion$147 
v3.24.1.u1
FAIR VALUE MEASUREMENTS
 3 Months Ended
Mar. 31, 2024
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
The carrying amounts of our financial instruments, including accounts payable and accrued liabilities, approximate fair value due to their short maturities. Notes payable are recorded at amortized cost, which approximates fair value.
v3.24.1.u1
LEASES
 3 Months Ended
Mar. 31, 2024
Leases [Abstract]  
LEASES LEASES
We have operating leases for our corporate headquarters and our manufacturing and research facility, which expire in 2024. The components of lease cost were as follows (in thousands):
Three Months Ended
March 31,
20242023
Operating lease cost$56 $56 
As of March 31, 2024, maturities of operating lease liabilities were as follows (in thousands):
2024$164 
Total operating lease payments164 
Less: imputed interest(5)
Total operating lease liabilities$159 
v3.24.1.u1
STOCK-BASED COMPENSATION
 3 Months Ended
Mar. 31, 2024
Share-Based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION
In 2018, our stockholders approved the adoption of the SenesTech, Inc. 2018 Equity Incentive Plan (the “2018 Plan”) which provides for the issuance of stock-based instruments, such as stock options or restricted stock units, to employees or consultants as deemed appropriate. The 2018 Plan has since been amended and restated on certain occasions, most recently on June 26, 2023, when our stockholders approved an increase to the total number of authorized shares to 70,717 shares.
Currently, we only have stock options outstanding under the 2018 Plan, which are generally issued with a per share exercise price equal to the fair market value of our common stock at the date of grant. Options granted generally vest immediately, or ratably over a 12- to 36-month period coinciding with their respective service periods, with terms generally of five years. Certain stock option awards provide for accelerated vesting upon a change in control.
As of March 31, 2024, we had 42,049 shares of common stock available for issuance under the 2018 Plan.
The following table presents the outstanding stock option activity:
Number of OptionsWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Three months ended March 31, 2024:
Outstanding as of December 31, 202336,708 $119.70 4.0
Forfeited(41)300.62 3.0
Outstanding as of March 31, 202436,667 
(1)
119.49 3.8
(1) Includes options related to 8,249 shares that are inducement awards and not granted under the 2018 Plan.
The stock-based compensation expense was recorded as follows (in thousands):
Three Months Ended
March 31,
20242023
Research and development$4 $4 
Selling, general and administrative (1)
81162
Total stock-based compensation expense$85 $166 
(1) Includes $2,000 related to stock issued in exchange for marketing services for the three months ended March 31, 2023.
The allocation between research and development and selling, general and administrative expense was based on the department and services performed by the employee or non-employee.
At March 31, 2024, the total compensation cost related to unvested options not yet recognized was $207,000, which will be recognized over a weighted average period of 1.1 years, assuming the employees and non-employees complete their service period required for vesting.
v3.24.1.u1
STOCKHOLDERS' EQUITY
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
STOCKHOLDERS' EQUITY STOCKHOLDERS’ EQUITY
Activity in equity during the three month periods ended March 31, 2024 and 2023 was as follows (dollars in thousands):
Common StockAdditional
Paid-In
Capital 		Accumulated
Deficit 		Total
SharesAmount
2024
Balances as of December 31, 20235,140,024 $5 $136,259 $(129,913)$6,351 
Stock-based compensation— — 85 — 85 
Issuance of common stock upon exercise of warrants4,608 — 6 — 6 
Net loss— — — (1,832)(1,832)
Balances as of March 31, 20245,144,632 $5 $136,350 $(131,745)$4,610 
2023
Balances as of December 31, 202267,472 $— $127,482 $(122,203)$5,279 
Stock-based compensation— — 166 — 166 
Issuance of common stock upon exercise of warrants102,500 — — — — 
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes1,102 — (11)— (11)
Issuance of common stock for service4,539 — 100 — 100 
Net loss— — — (2,037)(2,037)
Balances as of March 31, 2023175,613 $— $127,737 $(124,240)$3,497 
COMMON STOCK WARRANTS
The following table presents the common stock warrant activity:
SharesWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Outstanding as of December 31, 20237,775,734 $2.95 3.4
Exercised(4,608)1.30 — 
Outstanding as of March 31, 20247,771,126 2.95 3.1
During the three months ended March 31, 2024, warrants representing 4,608 shares of common stock were exercised with an exercise price of $1.30 per share.
v3.24.1.u1
COMMON STOCK WARRANTS
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
COMMON STOCK WARRANTS STOCKHOLDERS’ EQUITY
Activity in equity during the three month periods ended March 31, 2024 and 2023 was as follows (dollars in thousands):
Common StockAdditional
Paid-In
Capital 		Accumulated
Deficit 		Total
SharesAmount
2024
Balances as of December 31, 20235,140,024 $5 $136,259 $(129,913)$6,351 
Stock-based compensation— — 85 — 85 
Issuance of common stock upon exercise of warrants4,608 — 6 — 6 
Net loss— — — (1,832)(1,832)
Balances as of March 31, 20245,144,632 $5 $136,350 $(131,745)$4,610 
2023
Balances as of December 31, 202267,472 $— $127,482 $(122,203)$5,279 
Stock-based compensation— — 166 — 166 
Issuance of common stock upon exercise of warrants102,500 — — — — 
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes1,102 — (11)— (11)
Issuance of common stock for service4,539 — 100 — 100 
Net loss— — — (2,037)(2,037)
Balances as of March 31, 2023175,613 $— $127,737 $(124,240)$3,497 
COMMON STOCK WARRANTS
The following table presents the common stock warrant activity:
SharesWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Outstanding as of December 31, 20237,775,734 $2.95 3.4
Exercised(4,608)1.30 — 
Outstanding as of March 31, 20247,771,126 2.95 3.1
During the three months ended March 31, 2024, warrants representing 4,608 shares of common stock were exercised with an exercise price of $1.30 per share.
v3.24.1.u1
LOSS PER SHARE
 3 Months Ended
Mar. 31, 2024
Earnings Per Share [Abstract]  
LOSS PER SHARE LOSS PER SHARE
Basic loss per share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period, which includes prefunded warrants and shares held in abeyance from date of issuance. Diluted loss per share is computed by dividing the loss attributable to common stockholders by the weighted average number of common shares used in the basic loss per share calculation plus potentially dilutive securities outstanding during the period determined using the treasury stock method. Stock options and warrants are considered to be potentially dilutive securities but have been excluded from the calculation of diluted loss per share because their effect would be anti-dilutive given the net losses reported for all periods presented. Therefore, basic and diluted loss per share are the same for each period presented.
The following shares were excluded from the calculation of diluted net loss per share:
Three Months Ended
March 31,
20242023
Common stock warrants— 265,401 
Stock options— 23,371 
— 288,772 
v3.24.1.u1
SUBSEQUENT EVENTS
 3 Months Ended
Mar. 31, 2024
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS SUBSEQUENT EVENTS
We have evaluated subsequent events from the balance sheet date through May 9, 2024, the date at which the condensed financial statements were issued, and determined that there were no additional items that require adjustment to or disclosure in the condensed financial statements.
v3.24.1.u1
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Pay vs Performance Disclosure    
Net loss $ (1,832) $ (2,037)
v3.24.1.u1
Insider Trading Arrangements
 3 Months Ended
Mar. 31, 2024
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.24.1.u1
BASIS OF PRESENTATION (Policies)
 3 Months Ended
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Condensed Financial Statements
Condensed Financial Statements
Our accompanying unaudited condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with the U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. In our opinion, the unaudited condensed financial statements include all material adjustments, all of which are of a normal and recurring nature, necessary to present fairly our financial position as of March 31, 2024, and our operating results and cash flows for the three month periods ended March 31, 2024 and 2023.
Recent Accounting Pronouncements
Recent Accounting Pronouncements
There have been no new accounting pronouncements not yet effective or adopted in the current year that we believe have a significant impact, or potential significant impact, to our condensed financial statements.
Use of Estimates
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and classification of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. The significant estimates in our financial statements include the valuation of inventory, common stock warrants, and stock-based awards, such as stock options and restricted stock units. Actual results could differ from such estimates.
Comprehensive Loss
Comprehensive Loss
We have no other comprehensive income items for the periods presented. As a result, our net loss and comprehensive loss were the same for the periods presented and a separate statement of comprehensive loss is not included in the accompanying condensed financial statements.
Advertising Costs
Advertising Costs
Advertising costs are expensed as incurred and was $61,000 and $41,000 for the three months ended March 31, 2024 and 2023.
Cash and Cash Equivalents
Cash and Cash Equivalents
Highly liquid investments with maturities of three months or less as of the date of acquisition are classified as cash equivalents, of which we had $3.6 million and $5.4 million as of March 31, 2024 and December 31, 2023, respectively, included within cash and cash equivalents in the condensed balance sheets.
v3.24.1.u1
BALANCE SHEET COMPONENTS (Tables)
 3 Months Ended
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of accounts receivable, net and activity in allowance for uncollectible accounts
Accounts receivable, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Accounts receivable$165 $99 
Allowance for uncollectible accounts(4)(4)
Accounts receivable, net$161 $95 
The following was the activity in the allowance for uncollectible accounts (in thousands):
Three Months Ended
March 31,
20242023
Balance as of beginning of period$4 $6 
Increase in provision— — 
Amounts written off, less recoveries— (2)
Balance as of end of period$4 $4 
Schedule of inventory, net and activity in reserve for obsolescence
Inventory, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Raw materials$797 $747 
Work in progress11 — 
Finished goods71 53 
Total inventory879 800 
Less: reserve for obsolescence(5)(5)
Inventory, net$874 $795 
The following was the activity in the reserve for obsolescence (in thousands):
Three Months Ended
March 31,
20242023
Balance as of beginning of period$5 $18 
Increase in reserve— — 
Amounts relieved— — 
Balance as of end of period$5 $18 
Schedule of prepaid expenses
Prepaid expenses consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Software licenses139 152 
Professional services66 30 
Insurance49 64 
Deposit on equipment purchase25 — 
Patents9 14 
Prepaid inventory8 111 
Other50 17 
Total prepaid expenses$346 $388 
Schedule of property and equipment, net
Property and equipment, net consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Research and development equipment$1,763 $1,763 
Office and computer equipment808 808 
Autos54 54 
Furniture and fixtures41 41 
Leasehold improvements143 141 
Total in service2,809 2,807 
Accumulated depreciation and amortization(2,456)(2,419)
Property and equipment, net$353 $388 
Schedule of accrued expenses
Accrued expenses consisted of the following (in thousands):
March 31,
2024		December 31,
2023
Compensation, severance and related benefits$285 $232 
Legal and consulting professional services27 121 
Product warranty12 15 
Other67 — 
Total accrued expenses$391 $368 
Schedule of maturities of notes payable
As of March 31, 2024, future principal payments were as follows (in thousands):
2024$25 
202536 
202639 
202743 
202838 
Total principal payments181 
Less: current portion of notes payable(34)
Notes payable, less current portion$147 
v3.24.1.u1
LEASES (Tables)
 3 Months Ended
Mar. 31, 2024
Leases [Abstract]  
Schedule of components of lease cost The components of lease cost were as follows (in thousands):
Three Months Ended
March 31,
20242023
Operating lease cost$56 $56 
Schedule of future minimum operating lease payments
As of March 31, 2024, maturities of operating lease liabilities were as follows (in thousands):
2024$164 
Total operating lease payments164 
Less: imputed interest(5)
Total operating lease liabilities$159 
v3.24.1.u1
STOCK-BASED COMPENSATION (Tables)
 3 Months Ended
Mar. 31, 2024
Share-Based Payment Arrangement [Abstract]  
Schedule of stock option activity
The following table presents the outstanding stock option activity:
Number of OptionsWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Three months ended March 31, 2024:
Outstanding as of December 31, 202336,708 $119.70 4.0
Forfeited(41)300.62 3.0
Outstanding as of March 31, 202436,667 
(1)
119.49 3.8
(1) Includes options related to 8,249 shares that are inducement awards and not granted under the 2018 Plan.
Schedule of stock-based compensation expense
The stock-based compensation expense was recorded as follows (in thousands):
Three Months Ended
March 31,
20242023
Research and development$4 $4 
Selling, general and administrative (1)
81162
Total stock-based compensation expense$85 $166 
(1) Includes $2,000 related to stock issued in exchange for marketing services for the three months ended March 31, 2023.
v3.24.1.u1
STOCKHOLDERS' EQUITY (Tables)
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
Schedule of stockholders' equity activity
Activity in equity during the three month periods ended March 31, 2024 and 2023 was as follows (dollars in thousands):
Common StockAdditional
Paid-In
Capital 		Accumulated
Deficit 		Total
SharesAmount
2024
Balances as of December 31, 20235,140,024 $5 $136,259 $(129,913)$6,351 
Stock-based compensation— — 85 — 85 
Issuance of common stock upon exercise of warrants4,608 — 6 — 6 
Net loss— — — (1,832)(1,832)
Balances as of March 31, 20245,144,632 $5 $136,350 $(131,745)$4,610 
2023
Balances as of December 31, 202267,472 $— $127,482 $(122,203)$5,279 
Stock-based compensation— — 166 — 166 
Issuance of common stock upon exercise of warrants102,500 — — — — 
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes1,102 — (11)— (11)
Issuance of common stock for service4,539 — 100 — 100 
Net loss— — — (2,037)(2,037)
Balances as of March 31, 2023175,613 $— $127,737 $(124,240)$3,497 
v3.24.1.u1
COMMON STOCK WARRANTS (Tables)
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
Schedule of common stock warrant activity
The following table presents the common stock warrant activity:
SharesWeighted
Average
Exercise
Price Per
Share		Weighted
Average
Remaining
Contractual
Term
(years)
Outstanding as of December 31, 20237,775,734 $2.95 3.4
Exercised(4,608)1.30 — 
Outstanding as of March 31, 20247,771,126 2.95 3.1
v3.24.1.u1
LOSS PER SHARE (Tables)
 3 Months Ended
Mar. 31, 2024
Earnings Per Share [Abstract]  
Schedule of outstanding potentially dilutive securities
The following shares were excluded from the calculation of diluted net loss per share:
Three Months Ended
March 31,
20242023
Common stock warrants— 265,401 
Stock options— 23,371 
— 288,772 
v3.24.1.u1
BASIS OF PRESENTATION (Details)
$ in Thousands
 2 Months Ended 3 Months Ended
Dec. 31, 2023
USD ($)
state
Mar. 31, 2024
USD ($)
territory
state
Mar. 31, 2023
USD ($)
Organization and Description of Business [Line Items]      
Number of states registration received | state   50  
Number of states approved removal of RUP designation | state   49  
Number of major U.S. territories registration received | territory   5  
Accumulated deficit | $ $ 129,913 $ 131,745  
Cash and cash equivalents | $ $ 5,395 3,562  
Advertising costs | $   $ 61 $ 41
Evolve      
Organization and Description of Business [Line Items]      
Number of states authorized to sell product | state 33    
v3.24.1.u1
BALANCE SHEET COMPONENTS - Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Cash and cash equivalents $ 5,395 $ 3,562
Debt Instrument [Line Items]    
Cash and cash equivalents $ 5,395 $ 3,562
Notes Payable    
Debt Instrument [Line Items]    
Debt, annual interest rate 9.10%  
Debt, term 5 years  
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of accounts receivable, net (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Mar. 31, 2023
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]        
Accounts receivable $ 165 $ 99    
Allowance for uncollectible accounts (4) (4) $ (4) $ (6)
Accounts receivable, net $ 161 $ 95    
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of allowance for uncollectible accounts (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Accounts Receivable, Allowance for Credit Loss [Roll Forward]    
Balance as of beginning of period $ 4 $ 6
Increase in provision 0 0
Amounts written off, less recoveries 0 (2)
Balance as of end of period $ 4 $ 4
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of inventory, net (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Mar. 31, 2023
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]        
Raw materials $ 797 $ 747    
Work in progress 11 0    
Finished goods 71 53    
Total inventory 879 800    
Less: reserve for obsolescence (5) (5) $ (18) $ (18)
Inventory, net $ 874 $ 795    
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of activity in reserve for obsolescence (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Inventory, Valuation Reserves [Roll Forward]    
Balance as of beginning of period $ 5 $ 18
Increase in reserve 0 0
Amounts relieved 0 0
Balance as of end of period $ 5 $ 18
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of prepaid expenses (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Software licenses $ 139 $ 152
Professional services 66 30
Insurance 49 64
Deposit on equipment purchase 25 0
Patents 9 14
Prepaid inventory 8 111
Other 50 17
Total prepaid expenses $ 346 $ 388
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of property and equipment, net (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Property, Plant and Equipment [Line Items]    
Accumulated depreciation and amortization $ (2,456) $ (2,419)
Property and equipment, net 353 388
Depreciable Property, Plant and Equipment    
Property, Plant and Equipment [Line Items]    
Total in service 2,809 2,807
Research and development equipment    
Property, Plant and Equipment [Line Items]    
Total in service 1,763 1,763
Office and computer equipment    
Property, Plant and Equipment [Line Items]    
Total in service 808 808
Autos    
Property, Plant and Equipment [Line Items]    
Total in service 54 54
Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Total in service 41 41
Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Total in service $ 143 $ 141
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of accrued expenses (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Compensation, severance and related benefits $ 285 $ 232
Legal and consulting professional services 27 121
Product warranty 12 15
Other 67 0
Total accrued expenses $ 391 $ 368
v3.24.1.u1
BALANCE SHEET COMPONENTS - Schedule of notes payable maturities (Details) - Notes Payable
$ in Thousands
Mar. 31, 2024
USD ($)
Debt Instrument [Line Items]  
2024 $ 25
2025 36
2026 39
2027 43
2028 38
Total principal payments 181
Less: current portion of notes payable (34)
Notes payable, less current portion $ 147
v3.24.1.u1
LEASES - Schedule of lease cost (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Leases [Abstract]    
Operating lease cost $ 56 $ 56
v3.24.1.u1
LEASES - Schedule of maturities of operating leases liabilities (Details)
$ in Thousands
Mar. 31, 2024
USD ($)
Leases [Abstract]  
2023 $ 164
Total operating lease payments 164
Less: imputed interest (5)
Total operating lease liabilities $ 159
v3.24.1.u1
STOCK-BASED COMPENSATION - Narrative (Details) - 2018 Equity Incentive Plan - USD ($)
$ in Thousands
 3 Months Ended 6 Months Ended
Mar. 31, 2024
Jun. 30, 2019
Jun. 26, 2023
Stock-Based Compensation (Details) [Line Items]      
Shares authorized (in shares)     70,717
Common stock, available for issuance (in shares) 42,049    
Unrecognized compensation cost $ 207    
Stock Options      
Stock-Based Compensation (Details) [Line Items]      
Options, term   5 years  
Unrecognized compensation cost, period of recognition 1 year 1 month 6 days    
Minimum | Stock Options      
Stock-Based Compensation (Details) [Line Items]      
Options, vesting period   12 months  
Maximum | Stock Options      
Stock-Based Compensation (Details) [Line Items]      
Options, vesting period   36 months  
v3.24.1.u1
STOCK-BASED COMPENSATION - Schedule of stock option activity (Details) - $ / shares
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Number of Options    
Beginning Balance (in shares) 36,708  
Forfeited (in shares) (41)  
Ending Balance (in shares) 36,667 36,708
Weighted Average Exercise Price Per Share    
Beginning Balance (in dollars per share) $ 119.70  
Forfeited (in dollars per share) 300.62  
Ending Balance (in dollars per share) $ 119.49 $ 119.70
Weighted Average Remaining Contractual Term (years)    
Outstanding 3 years 9 months 18 days 4 years
Forfeited $ 3.0  
Stock Options, Inducement Awards    
Number of Options    
Ending Balance (in shares) 8,249  
v3.24.1.u1
STOCK-BASED COMPENSATION - Schedule of stock-based compensation expense (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Stock-Based Compensation (Details) [Line Items]    
Total stock-based compensation expense $ 85 $ 166
Issuance of common stock for service   100
Research and development    
Stock-Based Compensation (Details) [Line Items]    
Total stock-based compensation expense 4 4
Selling, general and administrative    
Stock-Based Compensation (Details) [Line Items]    
Total stock-based compensation expense $ 81 162
Issuance of common stock for service   $ 2
v3.24.1.u1
STOCKHOLDERS' EQUITY - Activity in stockholders' equity (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Increase (Decrease) in Stockholders' Equity [Roll Forward]    
Beginning Balance (in shares) 5,140,024  
Beginning Balance $ 6,351 $ 5,279
Stock-based compensation 85 166
Issuance of common stock upon exercise of warrants, net 6  
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes   (11)
Issuance of common stock for service   100
Net loss $ (1,832) (2,037)
Ending Balance (in shares) 5,144,632  
Ending Balance $ 4,610 $ 3,497
Common Stock    
Increase (Decrease) in Stockholders' Equity [Roll Forward]    
Beginning Balance (in shares) 5,140,024 67,472
Beginning Balance $ 5 $ 0
Issuance of common stock upon exercise of warrants (in shares) 4,608 102,500
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes (in shares)   1,102
Issuance of common stock for service (in shares)   4,539
Ending Balance (in shares) 5,144,632 175,613
Ending Balance $ 5 $ 0
Additional Paid-In Capital    
Increase (Decrease) in Stockholders' Equity [Roll Forward]    
Beginning Balance 136,259 127,482
Stock-based compensation 85 166
Issuance of common stock upon exercise of warrants, net 6  
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes   (11)
Issuance of common stock for service   100
Ending Balance 136,350 127,737
Accumulated Deficit    
Increase (Decrease) in Stockholders' Equity [Roll Forward]    
Beginning Balance (129,913) (122,203)
Net loss (1,832) (2,037)
Ending Balance $ (131,745) $ (124,240)
v3.24.1.u1
COMMON STOCK WARRANTS - Schedule of common stock warrant activity for the period (Details) - $ / shares
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Shares    
Beginning Balance (in shares) 7,775,734  
Exercised (in shares) (4,608)  
Ending Balance (in shares) 7,771,126 7,775,734
Weighted Average Exercise Price Per Share    
Beginning Balance (in dollars per share) $ 2.95  
Exercised (in dollars per share) 1.30  
Ending Balance (in dollars per share) $ 2.95 $ 2.95
Weighted Average Remaining Contractual Term (years)    
Outstanding (in years) 3 years 1 month 6 days 3 years 4 months 24 days
v3.24.1.u1
COMMON STOCK WARRANTS - Narrative (Details)
 3 Months Ended
Mar. 31, 2024
$ / shares
shares
Class of Warrant or Right [Line Items]  
Warrants, exercised (in shares) | shares 4,608
Warrants, exercised (in dollars per share) | $ / shares $ 1.30
PreFunded Warrants, Issued in November 2022, Common Stock, Registered Direct Offering  
Class of Warrant or Right [Line Items]  
Warrants, exercised (in shares) | shares 4,608
Warrants, exercised (in dollars per share) | $ / shares $ 1.30
v3.24.1.u1
LOSS PER SHARE -Schedule of outstanding potentially dilutive securities (Details) - shares
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Total (in shares) 0 288,772
Common stock warrants    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Total (in shares) 0 265,401
Stock options    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Total (in shares) 0 23,371
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