Milestone Scientific's Losses Widen, Raising Going Concern Doubts

TL;DR

**Milestone Scientific is burning cash and its 'going concern' warning means investors should steer clear until a clear path to profitability emerges.**

AI Summary

Milestone Scientific Inc. (MLSS) reported a net loss of $1,483,110 for the three months ended June 30, 2025, a significant decline from a net income of $223,638 in the prior-year period. For the six months ended June 30, 2025, the net loss widened to $3,477,696, compared to a net loss of $1,216,891 in the same period of 2024. Product sales, net, increased to $2,323,466 for the three months ended June 30, 2025, up from $1,853,764 in the prior year, and rose to $4,555,886 for the six months, from $4,102,609. However, selling, general and administrative expenses also increased to $3,030,952 for the quarter and $6,287,680 for the six months. The company's cash and cash equivalents decreased significantly to $1,274,314 as of June 30, 2025, from $3,258,058 at December 31, 2024. Milestone Scientific also incurred $800,000 in convertible notes payable to related parties during the six months ended June 30, 2025, and reported an accumulated deficit of $131.5 million since inception, raising substantial doubt about its ability to continue as a going concern.

Why It Matters

Milestone Scientific's widening losses and dwindling cash reserves, coupled with an accumulated deficit of $131.5 million, signal significant financial instability for investors. The 'going concern' warning directly impacts investor confidence and could lead to further stock price depreciation, especially given the reliance on additional capital raises. For employees, this financial precariousness could translate into job insecurity or delayed growth opportunities. Customers might face concerns about the long-term viability of product support and innovation from a company struggling with liquidity. In the competitive medical device market, MLSS's financial struggles could allow larger, more stable competitors to gain market share, particularly in the dental and medical anesthetic delivery systems space where products like CompuDent and CompuFlo Epidural compete.

Risk Assessment

Risk Level: high — The company explicitly states 'substantial doubt about our ability to continue as a going concern' due to recurring losses, an accumulated deficit of $131.5 million, and cash flows used in operating activities of $2.8 million for the six months ended June 30, 2025. Cash and cash equivalents have plummeted from $3,258,058 at December 31, 2024, to $1,274,314 at June 30, 2025, indicating a rapid depletion of liquidity.

Analyst Insight

Investors should exercise extreme caution and consider divesting from MLSS given the explicit 'going concern' warning and significant cash burn. Prospective investors should avoid initiating a position until the company demonstrates a clear and sustainable path to profitability and secures sufficient long-term funding, as the risk of further dilution or even bankruptcy is substantial.

Financial Highlights

debt To Equity

1.41

revenue

$4,555,886

operating Margin

N/A

total Assets

$8,050,830

total Debt

$4,710,558

net Income

-$3,477,696

eps

N/A

gross Margin

71.7%

cash Position

$1,274,314

revenue Growth

+11.0%

Revenue Breakdown

Key Numbers

• $1,483,110 — Net loss for Q2 2025 (Increased from a net income of $223,638 in Q2 2024)
• $3,477,696 — Net loss for H1 2025 (Worsened from a net loss of $1,216,891 in H1 2024)
• $1,274,314 — Cash and cash equivalents as of June 30, 2025 (Decreased significantly from $3,258,058 at December 31, 2024)
• $131.5 million — Accumulated deficit since inception (Indicates a history of significant losses)
• $2,323,466 — Product sales, net for Q2 2025 (Increased from $1,853,764 in Q2 2024)
• $4,555,886 — Product sales, net for H1 2025 (Increased from $4,102,609 in H1 2024)
• $2,772,273 — Net cash used in operating activities for H1 2025 (Increased from $434,473 in H1 2024, indicating higher cash burn)
• $800,000 — Convertible notes payable to related parties (New debt incurred during H1 2025)

Key Players & Entities

• Milestone Scientific Inc. (company) — registrant
• Wand Dental, Inc. (company) — wholly owned subsidiary
• Milestone Innovations Inc. (company) — wholly owned subsidiary
• Milestone Education LLC (company) — wholly owned subsidiary
• U.S. Food and Drug Administration (FDA) (regulator) — granted 510(k) marketing clearance
• CompuFlo Epidural Computer Controlled Anesthesia System (company) — medical device
• CompuDent (company) — dental device trademark
• CompuMed (company) — medical device trademark
• NYSE American (company) — exchange where common stock is registered

FAQ

Risk Factors

• Going Concern Uncertainty [high — financial]: The company reported a net loss of $1,483,110 for Q2 2025 and a widened net loss of $3,477,696 for H1 2025. Significant cash burn, evidenced by net cash used in operating activities of $2,772,273 for H1 2025 (up from $434,473 in H1 2024), and a substantial accumulated deficit of $131.5 million, raise substantial doubt about its ability to continue as a going concern.
• Deteriorating Cash Position [high — financial]: Cash and cash equivalents decreased significantly to $1,274,314 as of June 30, 2025, from $3,258,058 at December 31, 2024. This sharp decline, coupled with increased operating expenses, limits financial flexibility and may impact the company's ability to fund operations and meet short-term obligations.
• Increasing Operating Expenses [medium — financial]: Selling, general and administrative expenses increased to $3,030,952 for Q2 2025 and $6,287,680 for H1 2025. This rise outpaced revenue growth, contributing to the widening net loss and increased cash burn.
• Related Party Debt [medium — financial]: The company incurred $800,000 in convertible notes payable to related parties during H1 2025. While the terms are not detailed, such transactions can introduce complexities and potential conflicts of interest.
• Inventory Management [medium — operational]: Inventories represent a significant portion of current assets at $3,897,017 as of June 30, 2025. Fluctuations in demand or obsolescence could lead to write-downs and impact profitability.
• Competitive Landscape [medium — market]: The company operates in a competitive market where product innovation and market adoption are critical. Failure to effectively compete or adapt to market changes could negatively impact sales and financial performance.

Industry Context

Milestone Scientific operates in the medical device sector, specifically focusing on dental and surgical technologies. This industry is characterized by rapid innovation, stringent regulatory requirements (FDA, etc.), and a competitive landscape with both large established players and smaller specialized firms. Success hinges on product differentiation, clinical validation, effective sales channels, and managing the high costs associated with R&D and regulatory compliance.

Regulatory Implications

As a medical device company, Milestone Scientific is subject to rigorous oversight by regulatory bodies like the FDA. Compliance with manufacturing standards, product approvals, and post-market surveillance is critical. Any failure in these areas can lead to significant penalties, product recalls, and reputational damage, impacting financial performance and market access.

What Investors Should Do

1. Monitor cash burn and runway
2. Analyze SG&A expense trends
3. Evaluate going concern disclosures
4. Assess the impact of related party transactions

Key Dates

• 2025-06-30: End of Q2 2025 and H1 2025 reporting period — Financial results show increased net losses, declining cash, and rising expenses, raising going concern doubts.
• 2025-06-30: Cash and cash equivalents reported — Stood at $1,274,314, a significant decrease from $3,258,058 at year-end 2024.
• 2025-06-30: Convertible notes payable to related parties reported — Amount of $800,000 incurred during H1 2025, adding to liabilities.
• 2024-12-31: End of Fiscal Year 2024 — Reported cash and cash equivalents of $3,258,058.

Glossary

Accumulated Deficit

The cumulative net losses of a company since its inception that have not been offset by net income. (Indicates a history of unprofitability, with Milestone Scientific having an accumulated deficit of $131.5 million.)

Going Concern

An accounting assumption that a business will continue to operate for the foreseeable future. (The company's financial condition raises substantial doubt about its ability to continue as a going concern.)

Convertible Notes Payable

Debt instruments that can be converted into a predetermined amount of equity in the issuing company. (Milestone Scientific incurred $800,000 in such notes from related parties, adding to its debt obligations.)

Net Sales

The total revenue generated from sales after deducting returns, allowances, and discounts. (Product sales, net, showed an increase, but not enough to offset rising costs and expenses.)

Selling, General and Administrative Expenses (SG&A)

Costs incurred by a company in the process of selling products or services, and for the general management of the business. (These expenses increased significantly, contributing to the company's net losses.)

Year-Over-Year Comparison

Compared to the prior year, Milestone Scientific Inc. (MLSS) has seen a concerning deterioration in its financial performance. While product sales increased by 25.3% for the quarter ($2.32M vs $1.85M) and 11.0% for the six months ($4.56M vs $4.10M), this top-line growth has been overshadowed by a significant increase in net losses. The company swung from a net income of $223,638 in Q2 2024 to a net loss of $1,483,110 in Q2 2025, and the net loss for the six-month period widened substantially. This is largely driven by a sharp rise in Selling, General, and Administrative expenses, which increased despite the revenue gains. Furthermore, the company's cash position has been significantly depleted, falling from $3.26M at year-end 2024 to $1.27M as of June 30, 2025, raising serious going concern issues not present in the prior year's reporting.

Key Financial Figures

• $0.001 — l of 78,559,147 shares of Common Stock, $0.001 par value outstanding. DOCUMENTS INCOR
• $250,000 — nsurance Corporation insurance limit of $250,000. 6. Accounts Receivable The E-comme
• $10,000 — , net of allowance for credit losses of $10,000, respect

Filing Documents

• mlss20250814_10q.htm (10-Q) — 1356KB
• ex_839955.htm (EX-31.1) — 9KB
• ex_847266.htm (EX-31.2) — 10KB
• ex_839956.htm (EX-32.1) — 6KB
• ex_847267.htm (EX-32.2) — 6KB
• 0001437749-25-026919.txt ( ) — 6269KB
• mlss-20250630.xsd (EX-101.SCH) — 51KB
• mlss-20250630_cal.xml (EX-101.CAL) — 32KB
• mlss-20250630_def.xml (EX-101.DEF) — 357KB
• mlss-20250630_lab.xml (EX-101.LAB) — 301KB
• mlss-20250630_pre.xml (EX-101.PRE) — 382KB
• mlss20250814_10q_htm.xml (XML) — 1135KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements Balance Sheets as of June 30, 2025 (Unaudited) and December 31, 2024 4 5 6 8 Notes to Condensed Consolidated Financial Statements (Unaudited) 9 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 29 Item 4.

Controls and Procedures

Controls and Procedures 29

— OTHER INFORMATION

PART II — OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 29 Item 1A.

Risk Factors

Risk Factors 29 Item 1B Unresolved Staff Comments 29 Item 1C Cybersecurity 30 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 30 Item 3. Defaults Upon Senior Securities 30 Item 4. Mine Safety Disclosures 30 Item 5. Other Information 30 Item 6. Exhibits 31

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS When used in this Quarterly Report on Form 10-Q, the words "may", "will", "should", "expect", "believe", "anticipate", "continue", "estimate", "project", "intend" and similar expressions are intended to identify forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act") regarding events, conditions and financial trends that may affect Milestone Scientific's future plans of operations, business strategy, results of operations and financial condition. Milestone Scientific wishes to ensure that such statements are accompanied by meaningful cautionary statements pursuant to the safe harbor established in the Private Securities Litigation Reform Act of 1995. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. Milestone Scientific's plans and objectives are based, in part, on assumptions involving the continued expansion of its business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of Milestone Scientific. Although Milestone Scientific believes that its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate. Considering the significant uncertainties inherent in the forward-looking statements included herein, our history of operating losses that are expected to continue, requiring additional funding which we may be unable to raise capital when needed (which may force us to delay, curtail or eliminate commercialization efforts of our CompuFlo Epidural Computer Controlled Anesthesia System), the early stage operations of and relative lack of acceptance

- Financial Information

Part I- Financial Information

Financial Statements

Item 1. Financial Statements MILESTONE SCIENTIFIC AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) June 30, 2025 December 31, 2024 ASSETS Current assets: Cash and cash equivalents $ 1,274,314 $ 3,258,058 Accounts receivable, net of allowance for credit losses of $ 10,000 , respectively 684,201 475,376 Accounts receivable, related party net 6,429 - Prepaid expenses and other current assets 637,583 564,645 Inventories 3,897,017 3,713,215 Advances on contracts 1,131,284 1,275,260 Total current assets 7,630,828 9,286,554 Furniture, fixtures and equipment, net 14,671 12,921 Intangibles, net 113,494 148,404 Right of use assets finance lease 53,330 67,201 Right of use assets operating lease 214,357 257,842 Other assets 24,150 24,150 Total assets $ 8,050,830 $ 9,797,072 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 1,450,585 $ 1,021,393 Accounts payable, related party 505,455 493,313 Accrued expenses and other payables 1,388,782 1,796,319 Accrued expenses, related party 279,185 304,293 Current portion of finance lease liabilities 20,502 12,530 Current portion of operating lease liabilities 123,161 116,279 Total current liabilities 3,767,670 3,744,127 Non-current portion of finance lease liabilities 41,005 54,672 Non-current portion of operating lease liabilities 101,883 165,573 Convertible notes payable, related parties 800,000 - Total liabilities $ 4,710,558 $ 3,964,372 Commitments and contingencies Stockholders' equity Common stock, par value $ 0.001 ; authorized 100,000,000 shares; 78,592,480 shares issued and 78,559,147 shares outstanding as of June 30, 2025; 78,047,798 shares issued and 78,014,465 shares outstanding as of December 31, 2024; 78,592 78,048 Additional paid in capital 135,703,998 134,719,274 Accumulated deficit ( 131,530,802 ) ( 128,053,106 ) Treasury stock, at cost, 33,333 shares ( 911,516 ) ( 911,516 ) Tot

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