Nocopi Slashes Net Loss by 97% Despite Revenue Dip

TL;DR

**NNUP is cutting costs aggressively, but declining revenue is a red flag; watch for sustainable growth drivers before jumping in.**

AI Summary

NOCOPI TECHNOLOGIES INC/MD/ (NNUP) reported a significant reduction in net loss for the nine months ended September 30, 2025, narrowing to $59,900 from $2,284,700 in the prior year, a 97.38% improvement. This was primarily driven by a substantial decrease in general and administrative expenses, which fell to $692,300 from $3,196,900. Total revenues, however, declined by 19.72% to $1,224,800 from $1,525,700, mainly due to a drop in product and other sales from $1,198,700 to $784,200. Gross profit also decreased to $642,700 from $776,200. The company's cash and cash equivalents increased to $11,497,600 as of September 30, 2025, up from $10,839,700 at December 31, 2024. Long-term receivables decreased to $924,000 from $1,292,800, reflecting ongoing collections from four licensees. The company continues to manage its stock-based compensation, with a significant forfeiture of 1,443,548 unvested RSUs by an executive in December 2024.

Why It Matters

This filing reveals Nocopi Technologies is making strides in cost control, significantly reducing its net loss, which is a positive signal for investors concerned about profitability. However, the decline in total revenues, particularly in product sales, raises questions about the company's growth strategy and market competitiveness in its patented ink technology sector. For employees, the executive RSU forfeiture could indicate internal shifts or compensation restructuring. Customers might see continued innovation, but the revenue dip suggests potential challenges in market penetration or demand. The broader market will watch if Nocopi can translate cost efficiencies into sustainable revenue growth, especially against larger, more diversified competitors in the specialty chemicals and security printing industries.

Risk Assessment

Risk Level: medium — The risk level is medium due to the significant decline in total revenues by 19.72% for the nine months ended September 30, 2025, indicating potential challenges in core business operations. While the net loss dramatically improved, this was largely driven by a massive reduction in general and administrative expenses, which may not be sustainable without impacting future growth or operations.

Analyst Insight

Investors should closely monitor NNUP's next few quarters for signs of revenue stabilization or growth, particularly in product and other sales. While cost cutting is commendable, sustained top-line decline could erode long-term value. Consider this a 'wait and see' situation, looking for concrete strategies to boost sales rather than relying solely on expense reductions.

Financial Highlights

debt To Equity

N/A

revenue

$1,224,800

operating Margin

N/A

total Assets

$14,103,000

total Debt

N/A

net Income

-$59,900

eps

-$0.01

gross Margin

52.47%

cash Position

$11,497,600

revenue Growth

-19.72%

Revenue Breakdown

Key Numbers

• $59,900 — Net Loss (9 months ended Sep 30, 2025) (97.38% decrease from $2,284,700 in prior year)
• $1,224,800 — Total Revenues (9 months ended Sep 30, 2025) (19.72% decrease from $1,525,700 in prior year)
• $692,300 — General & Administrative Expenses (9 months ended Sep 30, 2025) (78.34% decrease from $3,196,900 in prior year)
• $11,497,600 — Cash and Cash Equivalents (Sep 30, 2025) (Increased from $10,839,700 at Dec 31, 2024)
• $924,000 — Long-term Receivables (Sep 30, 2025) (Decreased from $1,292,800 at Dec 31, 2024)
• 10,814,843 — Common Shares Outstanding (Nov 6, 2025) (Slight increase from 10,792,913 at Dec 31, 2024)
• $110,200 — Licenses, Royalties and Fees Revenue (3 months ended Sep 30, 2025) (Decreased from $151,500 in prior year quarter)
• $275,600 — Product and Other Sales Revenue (3 months ended Sep 30, 2025) (Decreased from $516,900 in prior year quarter)

Key Players & Entities

• NOCOPI TECHNOLOGIES INC/MD/ (company) — registrant
• NNUP (company) — ticker symbol
• Securities and Exchange Commission (regulator) — filing oversight
• $59,900 (dollar_amount) — net loss for nine months ended September 30, 2025
• $2,284,700 (dollar_amount) — net loss for nine months ended September 30, 2024
• $1,224,800 (dollar_amount) — total revenues for nine months ended September 30, 2025
• $1,525,700 (dollar_amount) — total revenues for nine months ended September 30, 2024
• $11,497,600 (dollar_amount) — cash and cash equivalents as of September 30, 2025
• $10,839,700 (dollar_amount) — cash and cash equivalents as of December 31, 2024
• PNC Bank (company) — primary bank for cash and cash equivalents

FAQ

Risk Factors

• Revenue Volatility [medium — financial]: The company experienced a 19.72% decrease in total revenues for the nine months ended September 30, 2025, falling to $1,224,800 from $1,525,700 in the prior year. This decline was primarily driven by a 34.57% drop in product and other sales. Future revenue may continue to be volatile and dependent on the success of product sales and licensing agreements.
• Dependence on Key Agreements [medium — operational]: The company relies on long-term receivables from four licensees, which decreased to $924,000 from $1,292,800. Any disruption or non-performance by these licensees could materially impact the company's financial condition and ability to collect outstanding amounts.
• Stock-Based Compensation Impact [low — financial]: A significant forfeiture of 1,443,548 unvested RSUs by an executive in December 2024 could impact future equity dilution and compensation expense. The company needs to manage its stock-based compensation strategy effectively to align with shareholder interests.
• Cost Management Effectiveness [medium — operational]: While general and administrative expenses saw a substantial reduction of 78.34% to $692,300 for the nine months ended September 30, 2025, from $3,196,900 in the prior year, continued vigilance in cost control is crucial. Any increase in operating expenses without a corresponding revenue increase could negatively affect profitability.

Industry Context

Nocopi Technologies operates in a sector that often involves intellectual property licensing and product sales. The industry can be characterized by long development cycles, reliance on strategic partnerships, and the need for continuous innovation. Companies in this space face challenges in revenue generation, particularly with product sales, and often manage significant R&D investments.

Regulatory Implications

As a publicly traded company, Nocopi Technologies is subject to SEC regulations and reporting requirements, including the timely filing of 10-Q reports. Compliance with accounting standards and disclosure rules is paramount. Any misstatements or failures in compliance could lead to regulatory scrutiny and penalties.

What Investors Should Do

1. Monitor revenue diversification strategies.
2. Analyze the sustainability of G&A cost reductions.
3. Evaluate the impact of long-term receivable collections.
4. Assess the implications of stock-based compensation adjustments.

Key Dates

• 2025-09-30: Nine Months Ended September 30, 2025 Financial Results — Reported a significant reduction in net loss by 97.38% to $59,900, primarily due to a drastic cut in G&A expenses, though revenues declined by 19.72%.
• 2025-09-30: Balance Sheet Date — Company held $11,497,600 in cash and cash equivalents, an increase from year-end 2024, indicating a strong liquidity position.
• 2024-12-01: Executive RSU Forfeiture — An executive forfeited 1,443,548 unvested RSUs, which could have implications for future stock compensation expenses and dilution.
• 2024-12-31: Year-End 2024 Balance Sheet Date — Company had $10,839,700 in cash and cash equivalents and $1,292,800 in long-term receivables.

Glossary

RSUs

Restricted Stock Units, a form of equity-based compensation that grants the recipient shares of stock after a vesting period. (The forfeiture of a large number of RSUs by an executive is a notable event impacting potential future share count and compensation costs.)

Gross Profit

The profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. (Gross profit decreased to $642,700 for the nine months ended September 30, 2025, reflecting lower revenues and cost of revenues.)

General and Administrative Expenses (G&A)

Costs incurred for the overall management and administration of a business, not directly tied to production or sales. (A significant reduction in G&A expenses was the primary driver for the improved net loss, highlighting successful cost-cutting measures.)

Long-term receivable

Money owed to the company that is expected to be collected in more than one year. (The company has long-term receivables from licensees, and their decrease indicates ongoing collection efforts or changes in licensing agreements.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, Nocopi Technologies has demonstrated a remarkable improvement in its bottom line, reducing its net loss by 97.38% to $59,900. This was achieved through aggressive cost management, particularly a 78.34% reduction in general and administrative expenses. However, this operational efficiency came at the cost of revenue, which declined by 19.72% due to lower product and other sales. The company's cash position has strengthened, while long-term receivables have decreased, indicating ongoing collection activities.

Key Financial Figures

• $0 — 4,843 shares of common stock, par value $0.01, as of November 6, 2025. NOCOPI TEC
• $1,410,000 — esulted in an incremental fair value of $1,410,000, calculated as the difference between t
• $8,350 — e on date of grant of $ 16,700 of which $8,350 was vested. The Company expenses the va
• $1,307,000 — nia NOL's began to expire in 2024, with $1,307,000 expiring by 2032. The remaining Pennsyl

Filing Documents

• nnup_10q-093025.htm (10-Q) — 598KB
• ex31x1.htm (EX-31.1) — 11KB
• ex31x2.htm (EX-31.2) — 11KB
• ex32x1.htm (EX-32.1) — 4KB
• 0001079973-25-001690.txt ( ) — 3558KB
• nnup-20250930.xsd (EX-101.SCH) — 25KB
• nnup-20250930_cal.xml (EX-101.CAL) — 42KB
• nnup-20250930_def.xml (EX-101.DEF) — 89KB
• nnup-20250930_lab.xml (EX-101.LAB) — 255KB
• nnup-20250930_pre.xml (EX-101.PRE) — 211KB
• nnup_10q-093025_htm.xml (XML) — 476KB

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements 1 1 Balance Sheets at September 30, 2025 and December 31, 2024 2 3 4

Notes to Financial Statements

Notes to Financial Statements 5

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

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 12

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 17

Controls and Procedures

Item 4. Controls and Procedures 17

OTHER INFORMATION

Part II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 18

Risk Factors

Item 1A. Risk Factors 18

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 18

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 18

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 18

Other Information

Item 5. Other Information 18

Exhibits

Item 6. Exhibits 18

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Nocopi Technologies, Inc. (unaudited) Three Months ended September 30 Nine Months ended September 30 2025 2024 2025 2024 Revenues Licenses, royalties and fees $ 110,200 $ 151,500 $ 440,600 $ 327,000 Product and other sales 275,600 516,900 784,200 1,198,700 Total revenues 385,800 668,400 1,224,800 1,525,700 Cost of revenues Licenses, royalties and fees 43,800 59,300 126,400 162,000 Product and other sales 164,500 228,800 455,700 587,500 Total cost of revenues 208,300 288,100 582,100 749,500 Gross profit 177,500 380,300 642,700 776,200 Operating expenses Research and development 43,600 43,600 131,800 127,100 Sales and marketing 71,300 91,600 219,600 236,500 General and administrative 205,300 727,400 692,300 3,196,900 Total operating expenses 320,200 862,600 1,043,700 3,560,500 Net loss from operations ( 142,700 ) ( 482,300 ) ( 401,000 ) ( 2,784,300 ) Other income (expenses) Other income — 84,000 — 84,000 Interest income 122,000 153,000 359,200 432,900 Interest expense and bank charges ( 6,100 ) ( 5,800 ) ( 18,100 ) ( 17,300 ) Total other income (expenses) 115,900 231,200 341,100 499,600 Net loss before income taxes ( 26,800 ) ( 251,100 ) ( 59,900 ) ( 2,284,700 ) Income taxes benefit — — — — Net loss $ ( 26,800 ) $ ( 251,100 ) $ ( 59,900 ) $ ( 2,284,700 ) Net loss per common share Basic and diluted $ ( .00 ) $ ( .02 ) $ ( .01 ) $ ( .22 ) Weighted average common shares outstanding Basic and diluted 10,800,223 10,508,488 10,795,350 10,503,615 *See accompanying notes to these condensed financial 1 Nocopi Technologies, Inc. Balance Sheets* (unaudited) September 30 December 31 2025 2024 Assets Current assets

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View this 10-Q filing on SEC EDGAR